You can’t buy happiness. But you can buy a boat and that’s about the same thing.
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In East Tennessee, our lakes are usually crowded with teenagers jet-skiing, fishermen fishing, friends sailing, families cruising and debris floating. After the deluge of rain this past spring, boats and skiers are still dodging flotsam and jetsam throughout the river. Most boaters know that sinking feeling when a propeller wrestles with a log, but did you know that boat protection can help cover the cost of repairs? If you have comprehensive insurance or property damage coverage built into your watercraft policy, your boat insurance will cover collision with rocks, logs, and other marine obstacles.
It’s not like I own a yacht, why would I need a watercraft policy?
The amount of boat insurance you need depends on a number of factors, including the boat’s value, motor size, age, and how it’s used. In general, most professionals recommend buying at least $1,000,000 in liability insurance, with boat insurance ranging anywhere from as little as $75 to as much as $500 per year. For uninsured/underinsured motorists coverage, a typical minimum is $10,000 to cover losses in the event someone without insurance is at fault in an incident on the water. The amount you purchase is flexible and should reflect the potential injuries you may incur if you or one of your passengers is seriously hurt, or your vessel is damaged. For example, a brand new high performance speed boat will need more coverage for bodily injury and property damage liability than a low-risk, slow-moving pontoon.
Boater’s insurance typically covers:
- Collision damage: Covers repairs or replacement in the event that your boat is damaged in an accident.
- Property damage liability: Should you damage someone else’s boat or property, then this will keep you covered.
- Bodily injury liability: In the event that you should injure someone while operating your boat, this helps protect your assets.
- Comprehensive: If your boat is stolen, vandalized, or damaged in a non-collision manner, your comprehensive provides compensation.
In the event that your boat’s wake causes damage to another watercraft or capsizes another boat, you would be responsible and could be held liable for damages. Don’t be caught off-guard, take out a boat insurance policy.
So, what does my Homeowner’s policy cover?
A home insurance policy provides limited coverage for your boat or watercraft should it be damaged, stolen or vandalized. In most policies, you would only be reimbursed up to $1,000 worth of coverage if your boat, jet ski or miscellaneous water craft is broken or damaged by the following: fire, wind, explosion, hail, theft, vandalism or falling objects. Since homeowner’s policies can have deductibles either greater than or close to $1,000, most claims would not make sense to file.
When it comes to hail damage, there is a peculiar provision in which the watercraft must be in an enclosed building for the damage to qualify. For example, if a hailstorm causes damage to a boat stored outside, you wouldn’t be able to file a homeowners claim in that case. But if the building or storage enclosure has glass that gets shattered and hail comes through that damages your boat, then you would be covered.
Personal Property
If you have items on your boat that are stolen or destroyed, you can likely use your homeowner’s insurance to recoup those losses. For example, your homeowner’s policy would cover your portable Bose speaker, but high-priced modifications and equipment exclusive to your boat should be covered under a boat insurance policy. Therefore, always carefully review the comprehensive coverage of your policy to determine exactly what is and is not covered. You may need to purchase additional riders, or policy endorsements.
If you injure someone or damage property with your watercraft, the homeowner’s liability policy can help cover any associated cost. These policies come with at least $100,000 in liability coverage you can use for legal expenses or restitution to pay the affected party. There are some important size and horsepower limitations when it comes to boats however. Generally the boat needs to be very small, and in no case will your jet ski be covered. To get more robust coverage for your boat or watercraft you should take out a boat or personal water craft (PWC) insurance policy.
| Vessel/Motor Type | When is it Covered by Liability Insurance? |
|---|---|
| Inboard or Inboard-Outdrive | Less than 50 HP |
| Outboard | Less than 25 HP |
| Sailboat | Smaller than 26 feet |
| Jet Skis | Never |
| Air boats | Never |
Whether you’re spending every day on the water or have your boat in storage for the winter, it’s important to keep your watercraft protected against the unexpected year-round. Coverage is not required by law, with the exception of Arkansas and Utah, but your lien holder and/or marina where you dock may have requirements. An agent can help answer your questions, but you can also learn about the coverage types below:
- Watercraft medical payments coverage
Helps pay medical costs if you or anyone on your boat is injured in an accident. - Watercraft liability coverage
If there’s an accident, this covers the medical and other expenses of whoever was injured as well as the costs of repairing or replacing another person’s boat or property. - Property coverage
Covers the damage to your boat if you’re involved in an accident with another boat or something else, like a pier, buoy, dock or debris. It also typically pays for damage caused by something other than a collision, such as theft, fire or vandalism. - Repair cost
Covers the repair work done on your boat, motor, equipment or trailer with no deduction for depreciation*. - Emergency services
If your boat breaks down, this covers the cost of towing and labor and the cost of delivering fuel, oil or a battery. - Uninsured watercraft coverage
If you’re in an accident with an uninsured boater, this helps pay for injuries that you, your family or anyone else on your boat sustains. - Agreed value option
When you’re reimbursed for your boat’s value, you’ll be reimbursed for what it was worth at the start of the policy regardless of the current market value. - Personal effect coverage
Covers your fishing equipment and other personal belongings if they’re damaged, lost or stolen. - Additional boat equipment
Covers boat accessories, like anchors, life jackets and navigation gear, up to the policy limits. - Boat trailer coverage
Covers damages to your trailer resulting from an accident or other unforeseen incident.
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