It is easy to realize the need for boat insurance during the peak season when you are trailering the boat back and forth to your favorite waterway or if it is kept at a marina. However, do make sure your boat policy covers land accidents, because in some instances only the automobile policy covers boats in tow. As the summer wanes and boats get pulled from the water for off-season storage, you may want to save some money by canceling your boat insurance policy. Though saving money sounds great, it may not be a wise choice in this case. There are good reasons to keep your boat insurance policy active year round, even in northern climates where winter storage of boats in back yards and garages is the norm.
Homeowner Policies and Boats
You have to read the fine print of your homeowner’s insurance policy, but it likely does not extend to cover your boat. If it does, it may offer only limited coverage. Clauses in homeowner policies may offer limited coverage for boats, personal watercraft, ATVs, riding lawnmowers and other items stored on the property, but it may be capped to a value far below the replacement cost of the boat and other items you own. Plus, the coverage may have limits on the types of loss covered. It may cover loss caused by a fire at the home but not theft, vandalism, flooding, wind or other loss types.
Bundled Insurance Discounts
Your insurance company probably offers a bundled discount when you have more than one policy. The discount can be significant enough to cover most of the cost of boat insurance. Dropping the coverage for part of the year may remove the discount, resulting in a net savings of only a few dollars. If it truly is a struggle to pay the premiums, shopping around for a lower rate is a better idea than dropping coverage on your boat. Just be sure that you are comparing apples to apples when considering another provider. Have your current policy coverage amounts and details with you when shopping for new insurance.
You may be one of the many boat owners who stores a boat on a trailer parked on your property. You may have been doing this for years without incident. If you are like most boat owners, you are meticulous in the care of it. You remove the fuel and store the batteries, and that goes a long way in reducing fire hazards for boats in storage. However, Boat U.S. Magazine lists lightning as one of the top 10 insurance claims for boats, and lightning occurs on and off the water. Plus, liability claims for accidents involving your boat can happen on land. Kids are notoriously tempted to play on stored boats.
If you are paying on your boat to own it, the lending institution likely requires that a specific type and amount of insurance coverage be maintained until the loan is completely paid. Be sure to read the details of the loan agreement and maintain adequate insurance. If the boat is stolen or destroyed by fire or any other reason, the loan still needs to be repaid. Loss incurred without insurance means you will continue to repay a loan for something you no longer have.
Boat insurance varies in cost based on the size of the boat, its type, and use and other factors, but the average cost is about $25 to $50 per month. Taking a Coast Guard safety class may reduce your boat insurance policy rates through discounts, making it even more affordable to keep year round.