Summer 2018 is well under way, and it is a hot one! Record-breaking highs have been recorded across the country and there’s still plenty of summertime to go. Naturally, an increasing number of Americans are taking to the water to help deal with the heat. While having a boat is incredibly exciting, it also can be a bit of an insurance nightmare if you’re not properly prepared. That’s why we’ve decided to write this article to answer a question that continues to come up: Do I need special insurance for my boat? In short, yes!
Unfortunately, most homeowners policies don’t include any kind of coverage for a boat. Which means that you need a specific insurance policy that’s designed to provide coverage for the types of problems you might encounter with a boat.
Much like car insurance, boat insurance varies greatly from one policy to the next. However, there are four main types of coverage you should consider: liability, comprehensive, collision and contents. You are probably familiar with all of those terms from your car insurance policy. Liability coverage applies to other peoples damages if you’re at fault in an accident. Comprehensive coverage protects you from acts of god like a major storm at sea. Collision coverage applies if your boat gets into a collision with another boat or stationary object. Predictably, contents coverage covers anything you may have on your boat in case it becomes damaged or destroyed.
There are a lot of factors to be considered when creating an effective boat insurance policy. Today, we’re going to go over the four most important ones–type of boat, valuation, usage and location. Let’s take a closer look at what those factors are.
This one doesn’t take a lot of explanation. Put simply–what kind of boat do you have? Is it a small boat or a big boat? Is it slow, or really fast? Most insurance companies pay special attention to the length and total size of a boat when considering what kind of coverage it needs. A faster boat will likely cost more to insure than a simple sailboat. If you’re thinking of buying a boat, take the time to figure out what type of boat fits best into your lifestyle, and your budget.
Just like with cars, the market value of your vehicle plays a large part in determining what your policy looks like. A million dollar yacht is going to cost more to insure than a tiny motor boat every time. A good policy will offer coverage for the total amount it would take to completely replace your boat should it be lost or irreparably damaged. A more expensive boat will always have a higher premium.
The amount that you actually use your boat has a massive impact on the cost of your policy. It’s also important to consider what you are going to use your boat for. A commercial fishing trawler is going to need a different type of insurance policy than a private sailboat. Are you sailing around the world? That expensive navigation equipment is going to raise the price of your policy. Take the time to consider when and why you are using your boat, all of this will have an affect on your insurance coverage.
Like almost any insurance policy, your location plays a big part in determining the price of your policy. This is particularly true when it comes to boating. Some waters are considered to be much more dangerous than others, which means insurance costs are going to be vastly more expensive if you frequent them. It’s very important to talk about where you will be using your boat with your insurer before deciding on a policy.
There are few things more relaxing than taking your boat out on a hot summer day. Don’t ruin that experience by failing to get the correct insurance policy. While owning a boat can be an overwhelming experience, having a proper insurance policy will let you rest easy no matter how rough the waters.
If you want to inquire about changing a policy, or learn more about purchasing a new one, we suggest reaching out to the staff at TGS Insurance. Visit www.tgsinsurance.com to learn more.