Let’s face it, the average boat owner doesn’t know much about the boat insurance policy he purchased to insure his favorite toy. If you’re like most boat owners, the only thing you know is what it’s costing you. And when it comes down to it, why should we know more than that?

You want to spend time on the water, not poring over boat insurance contracts filled with verbiage we don’t even fully understand.  But failure to understand what’s in your policies can lead to some real disappointments in the event that something should happen to our boats, or if, God forbid, someone were injured while we’re out on the water.

Fortunately, when it comes down to it, the coverages aren’t much different than car insurance. Still, we all know someone who has had an accident only to realize too late that they didn’t have as much coverage as they thought they had, or, worse, had the wrong kinds of insurance coverage for their particular problem. Hopefully, we’ll never need to worry about our boat insurance, or what kinds of coverage we do or don’t have, but in the event that an accident should happen, it’s much better to know what kind of coverage you have ahead of time.

Replacement coverage

Of course, if something happens to our boats, we want to get back on the water as soon as we can. But, do you know what kind of replacement coverage you have? Some insurance policies do offer complete replacement, of course, but such policies tend to be a bit pricier. No one can decide for us whether we should pay the extra principle for full replacement, or whether we should live with some degree of risk, but at the very least, we should know whether or not our boat would be replaced in the event of an accident.

Types of values

Policy features which offer some remuneration without actually replacing out boats include actual cash value and agreed value. These types of policies tend to be cheaper, unless, of course, you actually need to use them. In the event the boat is totaled, a policy featuring actual cash value reimbursement factors in the market value of the boat as it is at the time of the accident, factoring in depreciation in the boat’s value. Agreed value pays you an agreed upon sum should the boat be totaled.

If you’re not sure what kind of replacement insurance you have for your boat, ask your agent. If there’s anything you don’t understand about your coverage, ask him to explain it to you. We’d all rather be out of the water, but in the long run, it’s better to know what coverage we have, so if anything does happen to our boats while we’re out there, we won’t be faced with any additional unpleasant surprises with the insurance company.

Photo via plentyofants