Your boat should be a source of enjoyment and relaxation. Purchasing a great boat insurance policy can keep your time on the water stress-free. From collisions to a blown engine, even the most responsible boaters can run into problems out on the water. Before you take your boat out, make sure you have the proper insurance coverage. You do not want to be left without a safety net in the case of an accident or property damage.
Boat insurance can be purchased for all types of motorized watercraft from jet skis to fishing dinghies to yachts.
A common question boaters ask is, “Does boat insurance cover blown engines?” Whether or not your insurance company will pay for repairs not only depends on the cause of the damage, but on the type of insurance policy you have purchased.
Types of Damage Coverage
When purchasing a boat insurance policy, there are three main options for covering property damage.
- Actual Cash Value (ACV) pays the cost of replacing the vessel, less depreciation.
- Agreed Value consists of a payout amount the boat owner and insurer have previously agreed upon in the event of a covered total loss.
- Replacement Cost means if your boat is three years old or less, the insurer will replace it with a similar vessel.
Within those types of coverage, your individual policy will have guidelines for when property damage is covered by your insurance and when it is not. This can depend on your insurance company and the limits of the policy package you purchased.
Commonly Covered Loss
Standard boating policies are considered “at risk” policies, meaning that if the cause of the loss is not specifically excluded, it is automatically considered a covered loss. The following events are usually covered within claim limits.
- Fire, theft, and vandalism.
- Damage to person or property caused by your boat.
- Injuries to you and anyone on your boat in case of an accident caused by an uninsured boater.
- Medical payments including hospital bills, surgeries, and x-rays due to a boating injury.
- Oil removal and damage costs for fuel spills, up to certain statutory limits.
Your boat insurance may provide coverage for a blown engine. This depends not only on your insurance company but also on your policy. Your reimbursement may include replacement cost coverage, but can be subject to depreciation. The age of your motor will also be a factor.
For most policies, there are certain limitations to this type of coverage. It is mainly a question of cause. Common exclusions include:
- Normal wear and tear on the engine
- Improper engine maintenance
- Damage from mold, insects, zebra mussels, or small animals
- Defective machinery or machinery damage
Your boat liability insurance will cover financial obligations you incur if you are responsible for a boating incident that results in harm or damage to people or property. Without adequate liability insurance, you will have to pay these expenses out of your own pocket. Liability costs add up quickly. If you cause an accident, boat insurance could be one of the best investments you have ever made. Events you may be held financially responsible, or liable for, include:
- Property damage liability to another person’s boat, dock, or possessions.
- Bodily injury to another boater or passenger on your boat.
- Environmental damage, such as fuel spills.
- Wreckage removal after an accident.
When you file a claim, your insurance company will also consider the factors surrounding the incident and there are several considerations that may determine whether or not your insurance policy will cover it. It is important to find out these limitations and keep them in mind before you take your boat out onto the water.
For larger boats, insurance policies have limits outlining where you can or cannot navigate your vessel. If you operate your vessel outside of the agreed upon territory, your insurance may not cover you. Broader navigational parameters come with more expensive insurance policies.
Most boat owners store their boats out of the water during cold weather and insurance companies often give boat owners a credit because the vessel is not being used. However, if you take your boat out on the water before your agreed upon layup period ends, any damage you incur will not be covered by your insurance.
It can be tempting to let your children try their hand at driving the family boat, but if your child does not meet the age and license requirements, any damage to your boat caused in an accident will not be covered. You may also face legal expenses incurred through liability. Age and license requirements for operating personal watercraft vary from state to state, so be sure to check the requirements where you live before turning over the wheel.
Most insurance companies require older boats and jet skis to be inspected and assessed by a marine surveyor to determine their seaworthiness, condition, and market value. The results of the inspection will be used in determining your coverage. If you own an older vessel, it is a good idea to have it inspected for safety issues even if it is not required by your insurance.
A boat can be a significant investment and friends and family members often buy a boat together. In most cases, the boat will carry a single insurance policy with both owners named. If an accident happens, the owner not involved is still bound by the same liabilities and insurance responsibilities.
Boating is a popular way to get outdoors, relax, and spend time with those who are important to you. Owning a boat can be a very rewarding experience, but it is important to understand the insurance requirements that will protect both you and your investment. Before you hit the water, let an insurance agent at Gebhardt Insurance Group build you a policy that will give you adequate protection and peace of mind. Call or text us today at 520-836-3244 to find out more.