Boat Insurance

Understanding Boat Insurance


Boat insurance is a variety of insurance that is specifically engineered to protect watercraft of many types and their owners from the financial consequences of damage and/or injury that can happen anytime while on (or even off) the water. In some instances, similar to auto insurance coverage, boating insurance is legally required.

Who Needs It

Boat insurance coverage is like a combination of homeowners’ and vehicle insurance policies. Those with larger vessels, such as big yachts, will be most helped from a policy that closely follows the format of a homeowner’s insurance policy, while those with smaller recreational boats will be more appropriately protected by a form more similar to car insurance. Boat owners are advised to at least consider obtaining coverage for bodily injury and property damage. This includes injuries or deaths that occur on the boat and that can happen to other related parties too.

Policy Components

Boat owners are wise to study the details of any potential boat insurance policy before committing to any one policy. For many boat owners, coverage is designed to be in effect for certain parts of the year and will be inactive during the off-season in which a boat is berthed or out of the water. Additional coverage is also available for any damage that could occur during these off-season times of inactivity.
Another aspect of good boat insurance is how it can address how quickly a boat can depreciate in its monetary value. Just like buying a car, the minute you “drive” it off the lot for your first cruise it will decrease in its value. This is where an “agreed value” policy can be beneficial as it the kind of coverage that gives the boat owner the ability to have the boat fully replaced or be provided with a cash value that was previously agreed upon. Market value policies are determined by the presently appraised value of the boat, taking into consideration its depreciation. This can result a lower payout, but it also can mean lower premiums too.


Boat owners are advised to determine when and how often they will likely use their boat when looking for the right policy. Some coverage will only cover freshwater use while some can be bought to protect vessels that head out to certain distances beyond the coast in the open water. Owners are greatly encouraged to research the many ways to lower their premium costs. Examples include boating safety courses, installing safety extras, such as an engine kill-switch, and more. Talk with an insurance professional for more information on getting the best boat insurance coverage for both your needs and your budget.