5 Crucial Things to Know About Boating Insurance

Purchasing a boat is an expensive endeavor that requires a great deal of planning. If you are in the market to purchase a boat, one of the primary things you must consider carefully is boating insurance.

Many aspiring boat owners think that automobile insurance covers boat ownership. However, boats must be insured with a separate policy. Many boat insurance policies can be the source of much confusion and frustration.

Before you make your boat purchase, it is a good idea for you to take time to research the specific types of boating insurance. Here are 5 crucial things to know about boating insurance.

1. Your boat insurance needs to include various types of coverage. This includes coverage for onboard liabilities, injuries, property damage, medical payments, boating equipment, boat trailers, mechanical breakdowns, collision and engine failure. If you do not understand the specific details associated with each coverage type, you can contact an insurance company. Representatives can explain the coverage types to you.

2. You need to know the difference between ‘agreed value’ and ‘actual cash value’. With agreed value’ policies, you will receive a prearranged value of your boat if there is a loss. The disadvantage of selecting this type of policy is some accidents are not covered. A positive aspect of selecting this policy type is you know exactly the amount of money you will get for your boat. The ‘actual cash value’ means that you will get the value of the boat at the time of the loss. The downside is you will only receive the depreciated value of your boat.

3. If your boat has a trailer, you need to determine if the insurance policy covers it. Most boat policies do not automatically cover trailers. You might have to pay an additional premium for your boat’s trailer. In some instances, your automobile insurance may cover your trailer.

4. You need to determine whether you insurance company will pay for accidents that involve other drivers. In most cases, other drivers of your boat are covered by your insurance policy. However, if you rent your boat, and you do not have a commercial boating policy, other drivers are not covered.

5. You need to know whether your boat is insured on land. Boat accidents can occur as you are transporting your boat with a trailer. Your boat may only be covered by your auto insurance policy as it is being transported. As a result, it will be subject to the limitations of your auto insurance policy.

Boating insurance is the most important part of responsible boat ownership. It is important to understand all factors that affect boat ownership before you make the investment.