Purchasing a boat or yacht is an exciting time in one’s life. The freedom your newly purchased vessel will offer you is second to none. However, it’s important to be aware of the legalities and boat insurance requirements based on the size of the boat you buy, and where you plan to cruise. Let’s explore the insurance options below.
- Boat Insurance Basics
- Boat Insurance Cost
- Boat Insurance Coverage
- What does boat insurance cover?
- What does boat insurance not cover?
- Does insurance for boat cover hurricane damage?
- Does insurance for boat cover sinking?
- Does insurance for boat cover engine damage?
- Does insurance for boat cover hitting a rock?
- Does insurance for boat cover lower unit?
- Does insurance for boat cover storm damage?
- Does insurance for boat cover theft?
- Does my car insurance cover towing a boat?
- Is my boat dock covered by insurance?
- Do I need insurance on my boat trailer?
- Boat Insurance Questions Broken Down By State
- YATCO Boating and Fishing Guides
Boat Insurance Basics
What is boat insurance?
Boat insurance is similar to your car or home insurance — it protects you, your vessel and (if you opt for third-party coverage), any other vessels you cause damage to.
Do I need boat insurance?
Not every city or state will require you to have insurance for boat before you head out on the water. Even those states that don’t legally require insurance for a boat, it’s highly recommended to have some coverage for your boat or yacht. When you consider the costs of purchasing your boat in the first place, and the lives of your friends and family who may be onboard, it’s always a good idea to have some insurance coverage in place so you are protected. You’d hate to see your life savings go down the drain if there is an accident on the water and your beloved yacht suffers extensive damage you will now have to pay out of pocket to fix.
Do I need insurance when I rent a boat?
When you rent a boat, the insurance will usually be included from the boat rental company and extend to the users who rent the boat. Some rental companies will, however, require a boating safety card or certificate to prove you are capable of handling the boat for the duration of your rental.
Do you need a boat survey for insurance?
If you’re purchasing a brand-new boat, insurance companies won’t usually require a survey for coverage.
However, if you are buying a used boat, most insurance companies will require a recent survey to ensure they are aware of any issues or red flags before offering comprehensive coverage.
Boat Insurance Cost
How much is boat insurance?
To determine the cost of insurance for boat, your broker will take a few things into consideration:
- Type (sailing, motor, etc.)
- Cruising Grounds
- Time of Use (are you living onboard full time for example)
On average, your insurance for your boat will cost around 1.5% of the purchase price of the boat. So, if you buy a boat for $50,000, you can expect to pay around $750 every year for boat insurance.
How much is insurance for boat per month?
You can opt to pay for your boat insurance annually or monthly. If we use the above example, your annual premium of $750 would cost $62.50 a month. Some will charge a slightly higher premium for monthly rates and offer a slight discount if you pay annually up front.
How much is insurance for boat a year?
Given the factors above, the cost of boat insurance every year will fluctuate based on factors like the age of the boat, the condition it is in and the type of boat you plan to buy. But you should expect to pay around 1.5% of the purchase price of the boat on insurance every year.
Boat Insurance Coverage
What does boat insurance cover?
Boat insurance will have a few options for coverage. Some of the main options include:
- Your boat – the hull, sails if necessary, and complete coverage of the boat itself
- Liability – For damages or injuries to others
- Environmental and weather damages
- Medical payments
- Complete hull damage and loss when needed
- Extended coverage to dinghies or tenders
- Uninsured boaters
- Personal property onboard if stolen or lost
- Emergency towing and salvage
- Optional extension to trailer coverage during tow.
What does boat insurance not cover?
There are a number of exclusions you may come across when reviewing insurance policies. Some of the main ones include:
- Extended cruising cover – If you want to take your boat across the Atlantic, or from Florida to the Bahamas, you will need to opt into extended coverage before doing so.
- Ice or freezing – Unless you know you plan to keep your boat in the water in the winter (where this is feasible), you will need to show that you properly winterized the vessel and still sustained damage. Again, you need to add this coverage before the cold winter months, to ensure you are protected.
- Storage – If your boat is going to be laid up for an extended period, you’ll want to discuss options with your insurance broker to make sure additional coverage is added here.
- Animal damage – For example, if you sustain damage from vermin while laid up, this might not be covered by your policy so consider all scenarios when storing your boat for the season.
Does insurance for boat cover hurricane damage?
Yes, boat insurance covers hurricane damage. However, this isn’t always part of a standard insurance policy, so if you know you will be based in or cruising through hurricane zones, you’ll want to opt-in to this coverage before starting your trip.
Does insurance for boat cover sinking?
If you have comprehensive boat insurance, it should cover sinking and salvage if needed. Usually, it is only covered if the sinking was a result of an item already covered (ex. fire, storm, theft, etc.) that directly caused the sinking.
Does insurance for boat cover engine damage?
Yes, your boat insurance will usually cover engine damage or failure if these are a direct result of other items covered in your policy – for example, fire, theft, storm damage, collision, etc. When it is NOT covered, is when it is due to negligence and improper upkeep and maintenance of the engine.
Does insurance for boat cover hitting a rock?
If you have fully comprehensive coverage, your insurance will provide cover for hitting a rock. However, if you only opt for liability coverage (which protects other people or property hit by your boat or injured while onboard), you will not be covered as you don’t have coverage for your own boat.
Does insurance for boat cover lower unit?
The lower unit is (you guessed it) the lower part of the outboard motor that takes the power and rotation from the engine and transfers that power on to the propeller and prop shaft. Similar to engine coverage, as long as you have full coverage for your boat, your engine, and the lower unit will be covered, so long as the damage isn’t due to negligence.
Does insurance for boat cover storm damage?
Similar to hurricane cover, most insurance policies will cover storm damage, however you want to make sure you have opted into the right amount of coverage to ensure you are protected should any storm damage occur.
Does insurance for boat cover theft?
Yes, boat insurance will offer theft protection if you have comprehensive coverage. Basic insurance policies won’t always include theft coverage and it may depend on where your boat is stolen from. If it has been stolen from the storage facility where you are storing it, the owner of the storage facility’s insurance should cover this. Either way, it’s a great idea to have comprehensive insurance coverage in place so you know you are covered for any and all scenarios.
Does my car insurance cover towing a boat?
Normally, your car insurance will not extend cover to towing a boat. This is something you’ll opt into for your boat insurance – towing and trailer will need to be added to your policy so the boat and trailer are covered while in transit.
Is my boat dock covered by insurance?
If you have a home dock where you keep your boat, your homeowner’s insurance should extend to this, so it will not be something you have covered by boat insurance. If you’re unsure, contact your insurance broker to confirm that your home insurance includes coverage for your dock on your property. If you are wondering if the boat dock at your marina is covered by your insurance, you don’t have to worry as the docks will be covered by the marina itself under a commercial policy.
Do I need insurance on my boat trailer?
It depends where you are in the world, if boat trailer insurance is a legal requirement. However, it’s highly recommended (even if it is not the law), to have insurance on your boat trailer. This coverage will be added to your auto insurance policy (although some boat policies may offer it for when the boat is in transit) and since the trailer is often left unattended when not in use, it can be a prime target for vandalism or theft. Not to mention, if any damages occur to the trailer, you can avoid replacing this pricey item out of pocket.
Boat Insurance Questions Broken Down By State
Is boat insurance required in California?
Legally, you do not require boat insurance in California, however, it is highly encouraged to do so. Without insurance, you will have to pay out of pocket for any damage or risk a total loss of your boat too if the worst happens.
Do I need boat insurance in Florida?
Similarly, boat insurance is not a legal requirement to use your boat in Florida’s waters. However, if you needed a loan to purchase your boat, your lender may require insurance as a safety net. Again, it’s always wise to have a policy in place so you and your boat are protected should something go wrong.
Do you need boat insurance in Michigan?
Michigan law may not require boat insurance; however, the same rule applies to lenders likely requiring insurance if you used a loan to purchase your boat. In addition, if you plan to dock at public docks in Michigan, the marinas may require proof of insurance before they allow you to do so.
Do you need boat insurance in NY?
Like Michigan state, you may not legally require boat insurance to operate your vessel, however, marinas may require proof of insurance to dock your boat with them, and a lender may require proof of insurance if acquiring a loan to purchase your boat.
Do you need boat insurance in PA?
As we’ve seen with other states, Pennsylvania law doesn’t require you to have boat insurance before taking your boat out on the water. However, lenders and marinas or yacht clubs may require proof of insurance to secure a loan or dock your boat at their facilities.
Is boat insurance required in Washington State?
Washington State is a boater’s dream – a multitude of waterways to enjoy from the bow of your own boat. Even so, there is no legal requirement to have boat insurance before heading out on the water in Washington State. It is, however, highly recommended, to purchase boat insurance to protect yourself, your boat, and others on the water.
How much is boat insurance in Texas?
The exact cost of boat insurance in Texas will depend on the size of the boat, the year it was built, the condition it is in, the engines on board, and the value of the boat, just to name a few determining factors. Most people will have a policy of around $250 – $1,000 for the year.
While insurance may not be a legal requirement in a number of states, it’s strongly encouraged to take out a policy on your boat. You’ve worked hard to save up and purchase a boat, don’t let anything affect your time on the water by not being prepared if the worst should happen. From theft and engine failure to storm damage and total loss and salvage, comprehensive insurance coverage will protect your boat (and your dreams) for years to come.
YATCO Boating and Fishing Guides
- Types of Fish in Florida Guide: We’ve seen a number of fish that call Florida home and make this a bucket list fishing destination for many anglers in the world. If you’re wondering what fish are in season when or what types of fish can be found in a number of destinations across Florida, YATCO has a guide for that. For a complete run down on all the types of fish you can catch in Florida, check out YATCO’s guide.
- Sport Fishing Yacht Guide: Many recreational fishers will choose to use the best yacht for the job when it comes to fishing. And you can’t go wrong with a sportfishing yacht – specifically designed to hold all of your fishing gear, optimize space for maneuvering, and the power and stability to take you wherever the fish are. Explore YATCO’s Sportfishing Yacht Buying Guide.
- Flybridge Yacht Guide: Similar to the sport fishing yachts, flybridge yachts are also popular amongst anglers, thanks to their upper decks which offer the perfect height to explore the horizons and scan for fish activity. Learn more about flybridge yachts in our guide.
- Florida Deep Sea Fishing Florida: Deep sea fishing is a special type of fishing in which anglers head out to the depths of the ocean to pull out some really large game fish. You’ll want to look for water at least 100ft in depth, where you can discover fish like 1,000-pound marlin or hooking a big tuna! Learn more in YATCO’s Deep Sea Fishing Guide 2023.
- Boating in Florida Guide: Before you head out on the water for your next big catch of the day, it’s important to familiarize yourself with the rules of the water in Florida. Whether you are a resident, or someone looking to visit and do some fishing, you’ll want to be sure to heed the ways of the water. YATCO created a Boating in Florida Guide for this very reason.
- Boat Financing Guide: Maybe you want to make fishing more than just a charter once or twice a year, and instead invest in your own boat or yacht you can take out any time you want. And in a place like Florida, where the fishing season never ends, it’s the perfect place to buy your next yacht. Learn about Boat Financing in our Guide.
- Boat Maintenance Guide: Now you know the boat you want, it’s important to learn how to maintain it as well. There are a number of factors to consider when it comes to improving the longevity and overall look and feel of your boat or yacht. Learn the proper ways to keep your vessel in good shape with YATCO’s Boat Maintenance Guide.
- Boating the Right of Way Guide: Just as we need to learn the rules of the road when we head out in our car, it’s important to learn the rules of the water as well. Whether you are a seasoned sailor, or new to boating, YATCO created a Boating Right of Way Guide to better understand some of the rules and buoys or signage you may come across on the water.
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