What Is Boat Insurance?

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You might not have thought about it, but boat insurance is probably the oldest kind of insurance there is. The Marine Insurance Act ensures all marine craft like boats are legally obliged to have insurance cover. With car insurance plans there is usually an excess to deter people from claiming on small dents and scratches but with boat insurance the excess is considerably larger to avoid the same problem. Overall, the only difference between automobile insurance policy and that for a boat is the amount it is covering.

As soon as you become a boat owner in America, most states will require you to have a boat insurance policy in force. In the marine insurance industry, houseboats although generally only moored, are categorized as a pleasure boat together with jet boats, ski boats, sailboats, cabin cruisers and party boats. However, a speedboat is in a completely different category to say a fishing vessel owing to the nature of its activities and a higher insurance premium is likely.

Actual Cash Value boat insurance policies cover the cost of the vessel replacement les any depreciation form the time of the boats loss whereas most boat insurance plans will pay for the replacement of the craft, the engine as well as the trailer. Usually when a boat has been damaged beyond repair, its current market rate is calculated using second hand values as a guide. Optional insurance usually includes coverage for reasonable repairs, emergency services to your boat, motor, or boat trailer, and wreck removal. Whereas partial damage costs are worked out by calculating the entire charge of the restoration less any deductible items.

To guarantee the value of the boat should it happen to be an insurance write off then an Agreed Value boat insurance policy can be taken out where the boat owner and insurance company come to an agreement about how much the vessel is worth and compensate to this value. This type of policy also takes into account that old items have depreciated and have less value but are still replaced with new ones. With most Agreed value policies, the boat insurance company will require replacement value of some items like dinghies, sails, covers, drive units to name a few, before the policy payout value is agreed.

The two chief aspects of boat insurance are legal responsibility, or security and insurance or property loss. Liability insurance is there to cover against claims by another person that the insured vessel caused damage or injury to a third party. Remember to try and find a boat insurance agent with a good reputation of getting the best possible policies for his clients and a good record in claim settlement. A final piece of advice surrounds the liability section of the policy and the need to ensure you are covered should legal charges be brought against you relating to a matter that is protected under the boat insurance.

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