What Does Boat Insurance Cover

What is and isn’t Covered by Boat Insurance

When you’re out cruising, sailing, fishing or jet boating, you’d prefer not to be thinking about boat insurance coverage.

So, get good coverage prior to the season. Then you can focus on boating and that’s it.

There are three main coverages you get with boat insurance coverage and several optional ones.

Three Main Boat Insurance Coverages

When you look at boat insurance coverage, it may remind you of your auto policy. And like your auto policy, coverage and limits vary between companies. But the main types of coverage for boat insurance are liability and (physical) property damage:

  • Bodily Injury Liability- This coverage pays for expenses to an injury to others from an accident you caused. Medical bills, pain and suffering, defense costs and lost wages may all be covered.
  • Property Damage Liability- This coverage can pay costs from damage to other property from an accident you caused. This could be damage to another boat, dock or other structure.
  • Physical Damage- This covers damage to your own boat and its trailer. For example, if you hit a dock and your boat got damaged, the cost of repairing it would be covered. There are three ways this can be paid out:

  • Actual Cash Value- The market value of your boat and/or its parts

  • Agreed Value- You determine the amount of coverage when the policy is first written

  • Replacement Cost- Your boat will be replaced with the same type of new boat. However, it’s usually only available for boats less than two years old.

Replacement cost carries the most expensive premium expense. Also, deductibles are available for all of these coverages.

Six Optional Boat Insurance Coverages

Following are six optional boat insurance coverages:

  • Underinsured/Uninsured boaters- Will cover you in the event you get in an accident with a boater who doesn’t have insurance or is underinsured

  • Medical Payments- Medical or funeral expenses for you or your passengers will get paid for up to the policy limits, if you select this coverage 

  • Fishing Equipment- This pays for damage to fishing equipment being transferred on or off the boat as well as when on the boat

  • Personal Property- This pays for damage to personal property being transferred on or off the boat as well as when on the boat

  • Roadside Assistance- This covers the boat during towing and possibly the towing vehicle

  • Fuel Spill/Accident- Covers debris removal from an accident

Boat Coverage Exclusions

It’s very important that you check with your carrier on this because exclusions vary widely between companies. But here are some common exclusions:

Physical damage exclusions might include normal wear and tear, damage from insects, mold, animals, zebra mussels, defective machinery or machinery damage.

Other watercraft such as a jet ski or dinghy may not be covered on a yacht policy. You’ll need a separate policy for those vessels.

Also, coverage may be unavailable for persons operating the boat if they’re under 16 years old.

Steve Wyrostek -BoatInsurance.org Expert A 20 year plus veteran of the insurance industry, Steve managed departments in the personal and commercial lines areas of major insurers. He’s familiar with how insurance—ranging from boat to workers compensation—works.


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