Best Boat Insurance To Ensure Financial Security As You Sail

Do you own a boat or do you have plans to buy one and are unsure if boat insurance is necessary, why you need it, or what it covers? This article will serve as a guide and be the answer to all your questions regarding the best boat insurance so you can make the best financial decision for safe and happy sailing.

Having a boat to your name gives you a chance for leisurely pursuits like sailing, fishing, and excursions to secluded beaches. However, issues like accidents, capsizing, theft, fire, and weather can cast a shadow over your boating excursions and keep you on your toes regarding finances.

In these tough times where inflation is sky high and we are always worried about where the next financial blow might come from, having a boat and being worried about the fact that if anything were to happen to it, the damage to your pocket would be hard to recover from. especially when you own a boat only for leisure purposes can be extremely stressful.

Fewer people recognize how frequently boating accidents occur. In 2020 alone, there were 5,265 boating accidents reported to the United States Coast Guard, resulting in $62.5 million worth of property damage and 767 fatalities.

Accidents can happen at any time, so you can never be too careful, but you can be ready for anything by getting the finest boat insurance for your requirements. Although the majority of states don’t mandate boat insurance, a few of them do require boaters to pass a boating safety course. However, even if your state does not mandate boat insurance, you shouldn’t forgo it.

This article will serve as an all-in-one guide about the best boat insurance and its importance so follow on and get all your questions answered. Once you’ve arranged your insurance, you’ll be prepared to set sail into the untamed ocean with the confidence you need, to unwind and enjoy yourself.

What is boat insurance?

A sort of insurance that safeguards boat owners is known as boat owners’ insurance. Similar to auto insurance, it defends the owner against lawsuits asserting that their car has been physically damaged, or that it has been the cause of someone’s injuries or death while it has been in use.

Based on several factors, such as the type of boat, the seas it will travel, and how many months of the year the boat will be utilized, boat insurance policies can differ greatly in what they do and do not cover. However, there are a few fundamental types of coverage you may anticipate getting, as well as some possible savings for careful boaters.

Having boat insurance is quite necessary for your financial security. If you don’t worry about your boat being stolen or having its contents damaged, you are still at risk for liability. You endanger the lives of your passengers and your savings if your liability insurance is insufficient. Hence getting boat insurance is never a bad idea.

However, to avoid surprises down the road, prospective insurance purchasers should carefully review the details of their boat owner insurance policies. Depending on the insurer and the type of boat being insured, the coverage and price might vary significantly.

What does boat insurance cover?

Like car insurance, boat insurance has numerous coverage options to help in various circumstances. It is possible though to tailor boat insurance packages to cover you, your passengers, your belongings, and your boat. The several types of coverage boat insurance provided

  • Liability insurance for boats
  • Property coverage for boats
  • Medical payments coverage
  • Uninsured watercraft coverage

Liability insurance for boats

Your liability insurance will cover any losses if your boat causes harm to another person or their property, such as another boat, or if it causes an accident and causes injuries. It may also address issues that your watercraft causes for other people such as a sizable wake. If you are sued because of an issue covered by the policy, such as a boating accident, liability insurance also pays your legal expenses.

Property coverage for boats

The boat is covered under property insurance against theft and damage from mishaps or sinking. Whether the boat is on land or in the water, the coverage usually applies to it. If your boat is totaled or stolen, you can select between actual cash value and agreed value, often known as replacement cost coverage.

Your prices are impacted by the coverage you select, as is the amount the insurance provider will cover in the event of a claim. You may have the option of choosing between two coverage kinds when purchasing boat property insurance: agreed amount coverage or actual cash value coverage.

Depreciation is taken into consideration when determining the cost of repairs under actual cash value coverage. When you acquire coverage, your insurer and you come to an agreement on the value of your boat, which helps pay for repairs.

Medical payments coverage

Imagine that an accident on your boat results in injuries to you or your passengers. If additional costs arise, such as hospital bills, medication, or X-rays, medical payment coverage may assist to cover those costs. After an accident, it won’t be cost-effective to repair your boat or pay for your injuries. You would require a full-coverage boat insurance policy, which normally includes comprehensive and collision coverage, to safeguard your watercraft.

Uninsured watercraft coverage

Your medical expenses will be covered by uninsured watercraft coverage if another boater strikes your boat. It’s vital to remember that uninsured watercraft coverage only contributes to the cost of personal injury claims brought on by an uninsured boater, up to the policy limit.

However, if that same boater also destroys your watercraft, your boat insurance policy’s property coverage will probably assist in covering the cost of repairs, up to the policy’s limit. Before your insurance coverage will help with the expense of repairing or replacing your boat, you’ll likely also need to pay your deductible.

Boat insurance add-ons

You may require extra insurance as a boat owner according to your needs. You may need to access the different aspects you would be requiring entrance insurance. It is better to think things through before actually purchasing add-ons as you don’t want to make unwise financial decisions. You may need additional coverage such as.

  • Boat trailers
  • Towing
  • Special equipment such as fishing gear
  • Boating accessories such as radar
  • Dock contract liability
  • Fishing guide coverage
  • Ice and freezing coverage
  • Mechanical breakdown
  • Personal property

What does boat insurance not cover?

After getting boat insurance you might think that you may now not have to worry about anything regarding the finances of your boat under any circumstance. But that’s not the case. There are many aspects boat insurance does not cover like

  • Wear and tear from a regular boat use
  • Manufacturer defects
  • Faulty boat design
  • Corrosion
  • Overuse
  • Bug destruction
  • Mold damage
  • Damage from creatures or aquatic life

Types of boat insurance

Boat insurance is divided into two categories: “agreed value” and “real cash value.” Each policy, however, responds to a partial loss in a different way depending on the organization. Regardless of the insurance you have, make it a priority to verify with your insurance company and review how you will be compensated in the event of a loss.

Agreed value

If the boat is deemed a total loss, agreed value plans typically pay the sum specified on the policy. In other words, if there is a total loss, the insurer agrees to pay the sum specified on the policy. Damage resulting from a partial loss is often covered under an agreed value policy on a replacement cost (new for old) basis, minus your deductible.

For instance, while calculating the worth of lost or damaged items, physical depreciation won’t be taken into account. In the event of a covered loss, some assets that are subject to greater levels of normal wear and tear, such as canvas, sails, trailers, and some machinery, may be entitled to an allowance for depreciation.

Actual cash value

Although it typically costs less, an actual cash value policy offers less coverage than an agreed value policy. In the case of a total loss, an ACV policy offers coverage up to the vessel’s current market value, taking into account depreciation and the condition of the boat at the time of the loss. Payments for partial losses are typically scaled back based on the actual depreciation of the lost or damaged goods, as well as the policy deductible.

A boat owner seeking a more affordable option may find that an actual cash value policy meets their needs, even if an agreed value policy normally costs more and offers greater coverage. You and your insurance agent can discuss these possibilities.

How does boat owners’ insurance work?

The fundamental operating principles of boat owners’ insurance are the same as those of other, more well-known types of insurance. The insurer consents to accept responsibility for a variety of potential hazards connected with owning or operating a boat in exchange for several monthly insurance premiums. In the case of boat owners’ insurance, there could be risks like physical harm to the boat, the loss or theft of possessions kept on board or the harm or demise of its occupants or other parties.

Yachts, sailboats, and even houseboats are among the many various types of vessels that boat owners can insure. Based on the boat’s worth and anticipated use, the insurance coverage will be customized.

For instance, if a houseboat is maintained as permanently immobile, the owner may only need to insure against damage to or destruction of their home rather than accidents occurring while operating the boat. On the other hand, a boat owner would probably want to protect against both forms of risk as well as third-party liability.

The equipment required to operate a boat safely, such as life jackets, oars, and anchors, may also be covered by the insurance for boat owners. Electronic devices like televisions, global positioning systems (GPS), and radio gear may also be included in the additional coverage. Similar to the general categories for theft or loss of personal property featured in a typical house insurance policy, any personal things maintained on the boat may also be covered.

Why do you need boat insurance?

If you live in Arkansas or Utah, where boat insurance is required, then you will be needing insurance for most types of boats. Even if boat insurance isn’t required by law, it’s still a good idea to protect your investment with insurance, which can help pay for damage to your boat as well as any damages or injuries you cause to others. Here are some reasons why you need the best boat insurance

To obtain a loan and a dock space at a marina

Not all states mandate that you obtain boat liability insurance for all the different kinds of boats and the different purposes you are going to use your boat for. However, your bank may likely refuse to grant you a loan unless you can show proof of insurance.

In addition, before accepting a contract for a slip or mooring, the majority of marinas need proof. In general, most homeowner policies do not provide you with the boat insurance you require to meet these criteria. You’ll need to insure your boat with the various values provided to you by your insurer.

Your lender will require you to have boat insurance

Boats are costly investments. You probably financed it rather than paying cash upfront. If this is the case, lenders will usually require boat owners to carry insurance all year. It makes sense, after all, because the lenders are also investing. They must safeguard that investment throughout the year, not just during the boating off-season.

Your boat is at risk even when it’s not sailing

Boat insurance should, at the very least, protect you against fire, theft, and vandalism—events that regrettably occur year-round. Furthermore, because boatyards are normally closed throughout the winter, these unplanned incidents are more likely to happen then.

Boat coverage is not fully provided by homeowner’s insurance

You might believe that your homeowner’s insurance policy will immediately provide coverage for you. The truth is that your boat will only be covered by your homeowner’s insurance during the time it is on your property. When compared to what you would receive from a boat insurance policy, the quantity of coverage supplied is substantially less.

Nature does not have an off-season

While in storage, your boat is still vulnerable to damage from natural disasters such as fire, flooding, and, depending on where you live, hurricanes. Having the right boat insurance can save you tens of thousands of dollars.

Year-round yacht insurance is more economical

Nobody wants to spend more money than they have to. The thing is, canceling your boat policy for the winter months and then restarting it in the spring can be more expensive in the long run than carrying it all year.

The reason is that most insurance companies will reward you with a lower deductible after each claim-free year. If you cancel your boat insurance policy after each season, you’ll end up paying the full amount of your deductible if you need to file a claim. Loyalty discounts are frequently given for maintaining coverage and renewing annual policies.

Best boat insurance

Now that we have gone through the basics of boat insurance and why you would be needing boat insurance if you are a boat owner we will go through the best boat insurance companies. To help you find the right policy, we researched leading insurers and identified the five best boat insurance companies of 2022.

Allstate boat insurance

Although Allstate provides comprehensive boat insurance, its numerous discounts set it apart from rival firms. By utilizing those discounts, you could be able to obtain coverage for as little as $25 per month. Apart from its policies starting at as little as $25 per month it still offers other discounts like

  • Discount on boat education for using an authorized boater safety resource
  • Discount for signing up for automatic payments with Easy Pay Plan
  • Discount for paying your complete subscription up front with FullPay
  • Individuals who own their homes are eligible for a homeownership discount.
  • Discounts for bundling boat insurance with Allstate auto or property insurance

Allstate also offers optional additional coverages, allowing you to tailor your boat insurance to your specific needs. Emergency services coverage, personal effects coverage, and boat trailer coverage are all available riders.

A point to keep in mind is that Allstate received more customer complaints than is typical for a company of its size. It also has limited online information about its policies, coverage limits, and exclusions in addition you must work with an agent to learn more about available policies.

Pros

  • Customers of Allstate can save money by bundling their policies
  • Allstate Easy Pay users receive a discount
  • A lengthy list of optional coverages is provided

Cons

  • No special hurricane coverage
  • There is little information available about boat eligibility and restrictions
  • There is little information available about coverage limits and deductibles
  • A higher number of complaints than is typical

Markel boat insurance

The majority of boat insurance providers do not cover commercial boats, only recreational boats used for personal purposes. However, Markel allows you to obtain coverage regardless of whether you provide charters, serve as a guide, or accept paying sport fishing clients.

Along with insurance for pricey yachts and high-performance boats, the organization also provides other benefits like coverage for wreck removal, fishing equipment, professional angler liability, and tournament entry fee reimbursement.

To obtain a quote or comprehensive details regarding available plans, coverage limitations, and riders, you must engage with an agent. Agents aren’t available everywhere, so even while you can obtain coverage through an out-of-state agent, you won’t be able to personally meet with one.

Pros

  • Comprehensive coverage options
  • Options for tournament costs and fishing gear
  • Establishing regulations for high-performance boats

Cons

  • Can’t save money by combining with house or auto insurance
  • To obtain a quote, one must contact an agent.
  • Agents aren’t always available
  • Limited discounts available

State Farm boat insurance

The coverage from State Farm can help to ensure that your competition plans don’t go haywire if you’re a competitive angler who competes in tournaments. Some riders let you rent a boat while your own is getting fixed. If a covered loss prevents you from participating, it will even pay your entry fees for fishing tournaments.

You must be aware of how expensive fishing tournaments can be if you routinely participate in freshwater or saltwater competitions. For competitions of a small scale, entry fees can be as little as $25, and as much as hundreds of dollars for tournaments taking place at a large scale. Before a tournament, if your boat is damaged, you risk missing it and losing your registration fee.

When a fisherman’s boat is out of commission as a result of a covered loss, competitive anglers can use State Farm’s boat rental reimbursement benefit to rent a boat to use during the competition. Additionally, you can get rental liability insurance to safeguard you when operating a rental boat.

Alternatively, you can use the fishing tournament reimbursement to obtain compensation for non-refundable entrance fees if you are unable to participate because your boat is unusable as a result of a covered incident.

But it does come with some drawbacks as you must speak with a State Farm agent to obtain a quote; you cannot do this online. You’ll need to engage with an agent to learn about the coverage limitations, deductibles, and exclusions that State Farm offers because there isn’t much information available about its products online.

State Farm’s website is not a very efficient one nor is it updated. Due to this reason, it lacks any information on discounts, so you’ll need to speak with an agent to find out if you qualify for multi-policy discounts or any other savings.

Pros

  • Pays for your expenditures if you provide first aid
  • Missed fishing tournament costs may be paid
  • There is boat rental reimbursement and liability insurance available
  • Coverage for emergency services and wreckage removal is included

Cons

  • There is no special hurricane coverage
  • There are limited discounts
  • For a quote, you must contact an agent
  • There is little policy information available online
  • There is no online information about discounts

Chubb boat insurance

Chubb’s Masterpiece Recreational Marine Insurance policies are geared toward smaller vessels and personal watercraft such as wave runners and Jet Skis. Its boat insurance policy includes search and rescue coverage, trailer insurance, and temporary substitute watercraft insurance.

Chubb has insurance options for yachts and superyachts, but its coverage for smaller boats and watercraft stands out for the comprehensive level of security it gives. Boats under 35 feet in length are eligible for the customizable Masterpiece Recreational Marine Insurance policy.

The benefits provided by Chubb include the option to pick between agreed value and real cash value for total losses, automatic 30-day coverage for new boats, and emergency towing and service protection. Additionally, it provides precautionary measure protection, allowing you to be compensated for moving your boat out of the path of a hurricane or other catastrophe.

Additional coverage for riders, such as pet injury and fishing equipment coverage, can be added to your policy. The company claims that 98% of policyholders will receive a response within six hours of submitting a claim, indicating a quick response time.

Before the policy takes effect, boats over 27 feet in length and at least 25 years old must undergo a survey. You must also contact an agent to obtain a quote or learn more about the available coverage in your area.

Pros

  • Chubb claims to have quick claim response times
  • Coverage for new watercraft is automatic
  • There is pet injury protection and emergency towing available

Cons

  • Watercraft and boats must be no larger than 35 feet in length to be eligible for Chubb insurance
  • There will be no online purchases; you will need to work with an agent for details and quotes
  • Surveys are required for boats over 27 feet in length and 25 years old or older

Progressive boat insurance

Progressive is our pick for one of the best boat insurance companies overall because of its standard comprehensive, collision, and liability coverages, robust discounts, and wide range of optional add-ons.

Progressive’s standard boat insurance policies besides comprehensive and collision coverage include bodily injury and property liability insurance, fuel spill protection, and even roadside assistance. If your pet is injured in a covered boating accident, Progressive will pay up to $1,000 in veterinary bills or death benefits under the standard boat policy.

Progressive offers a variety of discounts that can reduce your premiums, including multi-policy, multi-boat, and safety course completion discounts. With optional insurance riders, you can add more coverage to your existing policy. Protection for carry-on items, fishing gear, mechanical breakdowns, and total loss replacement are all optional coverages.

But not everyone will be qualified for a Progressive policy. Your boat must be under 50 feet long and priced at less than $500,000. The limitations are much stricter in other states that are prone to hurricanes; in some areas, the maximum length is 35 feet and the maximum value is $175,000.

Progressive’s policies are intended more for boat owners who utilize their vessels for recreational purposes than for operators of commercial vessels. Additionally, it does not provide defense or compensation for lost money or canceled fishing tournaments.

Pros

  • A wide range of add-on coverage choices
  • Water sports coverage
  • Provides coverage in case of hurricane damage
  • A lot of discount options are available
  • Several optional riders are available
  • Coverage starts at just only $100

Cons

  • No fee reimbursement for fishing competitions
  • Does not provide coverage for luxury yachts
  • Age and use restrictions are applied on boats
  • There is no commercial coverage

How to obtain a quote for boat insurance?

Start by contacting the provider of your current house or vehicle insurance if you’re seeking boat insurance rates. A bundling discount is probably available if you purchase boat insurance from the same provider. On the websites of insurance providers, you may occasionally be able to get boat insurance quotations, but this service may not always be available. By getting quotations from other insurers, an independent agent can help you cast a wider net for prices.

Consider the type of coverage you require before asking for quotations. Gather specific details about your boat so the insurance provider can provide a precise estimate. Consider any supplemental coverage you might desire as well, such as towing assistance.

How much can boat insurance cost?

Boat insurance typically costs a few hundred dollars per year, but depending on the type of boat and your circumstances, this cost may exceed $1,000. The average annual cost of boat insurance is often between $200 and $500.

However, the type of boat you own and the area in which you live can have a significant impact on your boat insurance premiums. In general, a reasonable estimate for a boat insurance policy is somewhere between 1% and 5% of the boat’s value annually. For instance, you can expect insurance on a $100,000 boat to cost between $1,000 and $5,000 per year. Your exact boat insurance costs will depend on several factors, such as

  • Boat types, such as a sailboat, pontoon boats, or fishing boat
  • Length of boat
  • Age of the boat
  • Region; for instance, boat owners in hurricane-prone areas may pay extra
  • The number of engines your boat has and its horse
  • Intended use of the boat
  • The location you store your boat and the way you store it
  • Years of sailing experience as well as third-party feedback on your boat insurance coverage
  • Deductible
  • Safety precautions, such as whether you’ve taken a boating safety course
  • Your history of boat insurance claims

What should I get first, the boat or the insurance?

Before completing the paperwork to buy a boat, it’s a good idea to search around for insurance if you’re in the market for one. You may want to consider the cost of your coverage when deciding which boat you can reasonably afford because insurance prices can vary.

A local independent agent can help you with your purchase once you’ve reduced your options to two or three boats. Regarding your planned purchases, your advisor will obtain quotations from several insurance providers. The boat that is ultimately best for your requirements and price range can then be chosen by you.

An independent agent in your area can assist you in evaluating boat insurance rates and options so you can enjoy the water while remaining worry-free. If you’re thinking about buying a boat, talk to a local agent today to get the important information you’ll need for the best boat insurance.

Conclusion

Your boat is a substantial investment, regardless of whether you own a superyacht or a more affordable bass boat. Boat insurance is necessary to safeguard your vessel as well as your peace of mind while you sail the waters. It is a good idea to get quotations from various boat insurance providers because coverages, exclusions, and prices vary by business.

After getting the required quotations, compare boat insurance quotes from multiple providers to see which ones offer the lowest rates for you and your boat. A proper amount of research and conclusively identifying all your needs and circumstances regarding your boat can help you make a better financial decision concerning getting the best boat insurance.

Sandra Johnson

Sandra Johnson

Sandra Johnson was a few years out of school and took a job as a life insurance agent in California, selling coverage door-to-door for Prudential. The experience taught her about the technical components of insurance and its benefits for individuals and society, as well as the misunderstandings people often have about insurance. She has over ten years’ experience in the insurance industry, having worked as both a Broker and Underwriter, assisting clients across a broad range of industries. At Insurance Noon, Sarah diligently gathers all the required information and curates up pieces to provide meaningful insurance solutions. Her personal value proposition is to demonstrate a genuine interest in always adding value for clients.Her determined approach to guiding clients has turned her into a platinum adviser to multiple insurers.