My Insurance Insider and Finance Blog

Image via WikipediaVacations and holidays are the most anticipated days of the year. For someone who lives a busy lifestyle or who needs to get out of the monotonous routine of every day life, it is a must to enjoy the holidays. Be it Christmas, birthday, a special holiday or a short leave, boating is one activity that is always at the top of the list.

Boats are as valuable as an expensive car. Just like cars, boats require insurance too. This is for your protection, as its owner. Boat insurance works like that of car insurance with some variations in conditions.

Although most companies offer limited protection against property damage for small boats such as canoes, sail boats under a homeowners or renters insurance policy, the coverage usually is 10 percent of the property value that excludes liability coverage and could be added by an endorsement of homeowners insurance policy.

Larger and faster boats such as yachts, and personal watercraft such as jet skis require a separate boat insurance policy. Some factors such as size, type, value of the boat etc. will determine of how much you pay for insurance coverage.

Normally you would be compensated for any physical loss to the hull, machinery, fittings, furnishings and permanently attached equipment on the basis of actual cash value policy or on an agreed amount value basis.

In case of Actual Cash Value policy, you’ll get replacement cost less depreciation at the time of the loss. And in the event of total loss, settling the claim on market value basis is the standard practice. Partial losses, however are settled by taking into account the total cost of the repair less depreciation.

In an Agreed Amount Value policy, you and your insurer have agreed on a certain value and in the event of a total loss, you will get paid that agreed amount.

Besides above, you’ll get some additional coverage in the Boat insurance policy:

• Bodily injury caused to another person;
• Property damage caused to someone else’s property;
• Guest passenger liability for any legal expenses incurred by someone using the boat with the owner’s permission;
• Medical expenses for injuries to the boat owner and other passengers;
• Theft;

Most companies offer liability limits that ranges from $15,000 to $300,000. A typical policy comes with deductibles of $250 for property damage, $500 for theft and $1000 for medical expenses. Boat owners may also consider purchasing an umbrella liability policy which will provide additional protection for their boat, home and car.

Sometimes you’re eligible for discounts(as boat owner) of the followings:

• Diesel powered craft being less hazardous than gasoline powered boats;
• Coast Guard approved fire extinguishers;
• Ship-to-shore radios;
• Two years of claims-free experience;
• Multi-policies with the same insurer, such as a car, home or umbrella policy;
• Safety education courses, as offered by the Coast Guard Auxiliary, U.S. Power Squadrons or the American Red Cross

There are many insurance companies out there in the market who are specialized in boat insurance. Here are the things you have to do:

1. First and foremost, you should get a list of boat insurance providers within your area and select a few of the best.

2. Contact your chosen insurance companies, log on to their websites or call them. It would be better, if you can personally visit the insurance provider’s office. By doing so, you can judge their level of services, know how they deal with their clients and can get the opportunity to talk to the other visitors who are currently their clients.

3. Get quotes. Most boat insurance providers give free insurance quotes. If possible, get as many quotes as you can from different insurance companies. In doing so, you will be able to compare which company can give the best coverage possible.

4. Determine your insurance coverage type. Make sure you understand every statement and coverage.

5. Sign the contract. That’s it. You just have to sign the policy and pay for it. Once the policy is in force, then you and your boat are fully protected.

These are the common steps on acquiring boat insurance. Boat insurances depends on the provider. The key here is to select the insurance company that you trust the most.