Whether you own a commercial or pleasure vessel, marine insurance coverage is a must.  Your policy will be broken down into two basic sections – hull coverage and liability coverage – as follows:

Hull coverage – protects against accidental damage or loss to the vessel as well as its equipment and machinery.  Basically, it covers the hull, the engine, and anything that is required to operate the vessel.

Liability coverage – this is oftentimes referred to as the “Protection & Indemnity” part of your marine insurance policy.  This covers your legal responsibilities to 3rd parties such as loss of life, personal injury, and property damage resulting from the operation and ownership of your vessel.  If you are sued, this will pay for your legal defense if it’s a liability that your policy covers.

What is Covered?

Hull coverage usually covers the cost of repairs for damages resulting from several different perils.  Look for a policy that provides “all risk” coverage.  This protects against all losses that are not specifically excluded in your policy and includes:

  • collisions with docks, floating or submerged objects, or other vessels
  • damages or losses due to theft or vandalism
  • fire
  • weather-related perils (e.g. hail, lightning, rain, wave action, and wind)

You should also consider a marine insurance policy that protects your vessel when it is being stored or transported by trailer.  Remember, as the owner of the vessel you are responsible for maintaining it. Insurance cover is an important aspect of ensuring that your investment in a boat or yacht is safe.

Comparing Damage Coverage

The most important difference among policies is whether your coverage is based on the “ACV” (actual cash value) or “agreed value” loss settlement.  Here is how these are broken down for coverage purposes:

ACV or actual cash value – provides less coverage but the cost of premiums is usually lower.  The coverage amount is based on the current market value of your vessel should you experience a total loss.  The condition of the vessel when the loss occurred and depreciation are the primary factors that are taken into consideration.

Agreed value – will pay the total amount listed in the policy when there is a total loss.  Damages are usually paid for on a “new for old” or replacement cost basis less your deductible.  Physical depreciation is not factored in. You may discuss your requirements with an insurance company representative for quick answers.

Hull Deductibles

There are two types of hull deductibles in a marine insurance policy.  The first is the standard deductible that applies to all losses except damage due to hurricanes.  The second is the hurricane deductible which only applies to vessel damages resulting from a hurricane or a wind storm that has been named.  This deductible is usually twice what the standard is.  Most standard deductibles range from 2% to 5% of a vessel’s insured value while hurricane deductibles are double that (4% to 10%).

Call 1-800-585-1665 today to request a quote from InsureAnyBoat.com