Understanding boat insurance liability
Boat insurance won’t cover you from attacks by a giant Kraken, Leviathan or zombie pirates, but it does pay to know that there are real risks out on the water. You should have a good conversation with your broker to determine what the best policy for you should be and how much liability insurance should be included.
Do you sail gently across glass-like water?, or plow through the waves with a pair of 350hp Mercs cranking out massive rooster tails in your wake?. You’ll likely be looking at slightly different policies and liability coverage. Read below to learn a little more about boat liability insurance.
Basic Boat Insurance
Basic marine, or pleasure craft insurance covers you in the event of a loss or damage. This insurance covers non-commercial vessels with motors like yachts, sailboats, private fishing boats, cruise boats, and related leisure craft. It doesn’t cover small vessels like canoes, kayaks and other small craft which should be covered by your extended home insurance.
5 common coverage features of Boat Insurance
- Collision – This section covers repair or replacement of your vessel in the event of a collision if you are at fault. Note that these covers might not include spill cleanup or salvage costs.
- Comprehensive – Coverage for vandalism or if your boat is stolen or damaged in another event which is not a collision. Yes, it covers that sweet 10 speaker sound system and Bluetooth streaming deck.
- Property damage & liability – Coverage for damage that you might cause to another vessel, property or structures. See boat liability insurance next.
- Bodily injury liability – Liability cover that protects you if you might injure someone else while using your boat. Or if someone is injured while on your boat. Medical bills, lost income, pain and suffering, legal expenses. More on this below.
- Additional coverage – This is where you can advance the cover for oil spills, medical payments, fishing and boat equipment and coverage for uninsured boaters.
Boat Liability Insurance
Liability cover for boat and pleasure craft insurance is an important part of your marine insurance package. Liability comes into play when you have been deemed responsible for the particular accident or collision. Here are just a few reasons why. Accidents can happen at any time.
The most common accidents out on the water include:
- Operator inexperience
- Excessive Speed
- Distracted operation of the boat
- Improper lookout
What does marine liability cover?
- Property damage – damage done to someone else’s property. Dock, boat, structure, or other property
- Bodily injury – self-explanatory, but can cover medical costs, rehab, hospital costs, etc…
- Pollution liability – A lot of boat insurance won’t cover the cleanup of spilled oil or gas. Pollution liability protects you in the case of an oil spill or
- Boat recovery – Protects your obligation to recover and remove damaged boat or debris left by the event.
Be sure to inquire as to the liability portion of your policy. If you don’t you could be held accountable out of pocket for a whole host of expensive recovery and cleanup costs.
How much liability coverage do you need?
Common liability coverage is usually between $1 million and $5 million. If you run a cruise or some manner of ‘party boat’ you’ll want to look into additional coverage. It really pays to come to terms with what could happen out there on the water.
Consider all of the worst-case scenarios; if you’ve been proven liable for the accident, what are all of the possible costs that could come your way.
- You damage an expensive yacht and are sued for damages. You need to consider all medical, repair and legal bills.
- You strike a dock injuring one or more people while causing significant damage to your boat and the dock. You’re liable for all medical costs, lost wages, repair of the dock and any subsequent litigation that might come your way.
You’re also liable for injury to anyone on your boat, should they be injured as a result of negligence or inattention.