GIVE YOUR BOAT INSURANCE POLICY A CHECK-UP
by Ron Ballanti
Nobody likes to
pay for insurance. We don't even like to think about it. In today's
litigious society, insurance is regarded by many as a necessary evil,
at best. Until, that is, it's actually needed. Then, it suddenly becomes
the most important thing in the world.
The lesson here,
is not to wait until after you have had an accident, an onboard fire,
or you've experienced theft or vandalism, to give your serious thought
to your marine insurance policy. Unfortunately, waiting until it's too
late is exactly what many boaters are doing - and the results can be
costly. Blunders like forgetting to update your policy to cover expensive
new equipment added to your vessel, or not carrying enough (or the right
kind) of liability coverage for your protection, can be costly mistakes.
With this in mind, it may be time to give your boat's insurance policy
a check-up. Here are some important factors to consider:
Actual vs.
Stated Value Policy
This should be an
area of concern for many boaters. If you see the words Actual Cash Value
or ACV in your policy, it means you're covered up to the actual cash
value of your boat, motor or equipment (taking into account depreciation).
For example, say your two-year-old V-6 outboard gets stolen off your
boat. It will take well over $10,000 to buy a new one, but the ACV of
your two-year-old outboard - even if you've only used it a few times
- may be just a portion of this amount. You may have to pay a substantial
difference, in addition to your deductible, to help replace this almost-new
motor. In contrast, a Stated Value Policy reimburses you for replacement
cost up to a stated value for your boat, motor and other major components.
The premiums may be more expensive, but this kind of policy provides
better coverage. Note that this coverage only applies to boats/motors
that are six years old or less. After this period, coverage reverts
to an ACV policy.
Cover Your Assets
Don't forget to
take into account the costly things you add to your boat, such as a
T-Top, radar, GPS, chart plotter, depth sounder, and the like. List
them on your policy with the stated values, and keep receipts and/or
serial numbers somewhere other than in the boat. Notify your agent when
you add valuable accessories to your boat, or you may not be sufficiently
covered.
Know Your
Limitations
Some boat insurance
policies have national or travel limits. If you tow your boat long distances,
you may be risk exposed and not even know it. You may also have navigational
limits. That is, you may only be covered out to a certain distance offshore.
This is important for all boaters, including those who keep their boats
in the water. If you have limited coverage, you can get "trip"
coverage through your agent.
Foreign
Coverage
It should always
go without saying, but always purchase reputable Mexican insurance for
your boat, trailer and tow vehicle before crossing the border. When
traveling to Canada, usually all you have to do is notify your insurance
agent.
Liability
It’s extremely
important to carry enough liability coverage. Boating accidents are
not very common, but they can be catastrophic. If you are a homeowner,
$300,000 of coverage is typically a good starting point. More coverage
is always better, if possible. It’s also important to note that
normal boat liability coverage won’t protect you use your boat
for charter or guide services. Even if you just take people out for
paid “fishing lessons” you’ll need to be specially
covered and bonded.
Personal
Property Coverage
When setting policy
limits, you should know that items considered “personal property,”
such as accessories that can be removed from your boat, are typically
covered by your homeowner’s policy. Items such as fishing rods,
reels, cameras, tackle boxes, etc., are usually covered under your homeowner’s
policy, even if theft or vandalism occurs while you’re away from
home. Be sure to check with your insurance carrier, however, to make
sure all of your valuable marine accessories are protected.
Perform
Regular Check-ups
It’s a good
idea to review your policy annually with your insurance agent. Many
boaters find they do not have the right boat coverage for their particular
situations. If you are underinsured, you put yourself at serious financial
risk. On the other hand, you may be overinsured – paying for more
insurance than you actually need. Making sure you and your boat are
adequately protected on a regular basis will save you money and aggravation
in the long run.
About the Author:
Ron Ballanti is a veteran outdoor writer, boater and angler. He also
owns and operates Strike Zone Communications, a marine public relations
and marketing agency based in Northridge, California (Phone: 818- 349-4608.
Fax: 818-709-5524. E-mail: strikezne@earthlink.net). |
