Understanding insurance options before setting sail

One of the primary advantages of living in Florida, apart from the countless sunny days, lush greenery and ecological diversity, is the seemingly endless water access. Indeed, those looking to swim, kayak or take a boat out on the water can pick from any spot along the miles of sandy coastline, or spend their time out on one of the state’s many rivers or lakes.

Given this reality, you’ll find that many people in the Sunshine State have everything from canoes and sail boats to powerboats and jet skis parked in their driveways or down at the local marina. 

Those looking to join their nautical neighbors out on the water understandably have a host of questions relating to cost. In particular, they might want to know about insurance, namely what options are available, and what to expect in terms of coverage.

Physical damage of losses: Small craft     

In general, vessels like canoes/kayaks, small sailboats and small boats outfitted with engines capable of exceeding no more than 25 miles-per-hour are covered for property damage under a renters’ or homeowners’ policy.  

As for the coverage provided, it’s typically limited to $1,000 or 10 percent of the insured home’s value, and extends to the watercraft, trailer and motor combined.

While liability coverage is typically not included, it can be purchased via an endorsement to a renters’ or homeowners’ policy.

Physical damage of losses: Large craft     

If you are in the market for something more exciting, such as a jet ski, powerboat or even a yacht, a separate insurance policy will need to be purchased. Of course, the amount you pay will depend upon the type, size and value of the craft, and the waterways in which you plan to voyage.

In terms of damage or physical losses, most boat insurance policies cover everything from the furnishings and fittings to the machinery and hull. As to their structure, meaning what they cover, boat insurance policies come in two forms:

• Agreed value amount: The insurer and boat owner agree on the value of the boat and how much money will be paid in the event it’s declared a total loss ahead of time, while replacing old items for new in the event of partial loss (sans deduction for depreciation).
• Actual cash value: In the event of a partial loss, claims are settled by the total repair cost minus a percentage for depreciation, while in the event of a total loss, these policies pay out the craft’s current market value (much like a vehicle).    

We’ll continue this discussion in our next post …

If you believe your insurance company has unnecessarily delayed payment in connection with a boat damage claim or otherwise underpaid your claim, consider speaking with a skilled legal professional as soon as possible to learn more about your options.

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