If you are in the market for a boat, then it is time to begin considering your insurance options. Boats are unique when it comes to coverage, and failing to have the correct policy in place can be a costly mistake for owners. Here is a glimpse at the basics of boat insurance and how you can make the most out of your own policy without overpaying.
For the average boat owner, the vehicle will only be used seasonally and is stored for the rest of the year. This is one of the reasons that boat insurance policies are such a unique form of coverage. If the boat is stored at the owner’s home or a storage facility, then there may be partial coverage when it is not being operated. Unfortunately, this will rarely cover the full cost of replacing the boat if it is severely damaged or stolen. Basic policies must include times that the boat is on the water as well as when it is being stored. General liability boat policies will cover some or all of the costs for damaged property, injuries, and deaths.
Additional coverage is also a good idea for owners that will be spending more time on their boat, have a custom boat, or believe that their boat may breakdown on the water. There are a number of add-ons available to boat owners including towing options and coverage for belongings on the boat such as fishing gear.
Owners will also want to decide if they would like an actual cash value (ACV) or agreed amount value (AAC) policy. With an actual cash value policy, owners will be paid the value of the boat minus depreciation at the time of the accident or theft. The amount will be determined by the current market price for that particular boat. With an agreed amount value policy, the owner and the insurance provider will determine how much the policy is worth, and then adjust the premiums and deductibles accordingly. This often means a higher deductible, but depreciation is not taken into consideration.