Insurance & Financial Services
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Some tips on coverage for your vessel:
- Restrict your navigation area to what you realistically expect to use. Don't cover for East coast if you stay on Long Island Sound or Chesapeake Bay.
- Take a USCG or USPS boating course- it can help in premium determination.
- Make sure you understand exactly the coverage you are getting as well as what's not covered. If the policy doesn't make sense, ask for an explanation in laymen's terms- not insurance speak
- Agreed Value vs. Actual Cash Value: These are the two main choices for boat insurance and depreciation is what sets them apart.
An "Agreed Value" policy costs more but it pays more - it will cover the stated value of the policy in the event of a total loss. For example, a total loss on a $50,000 agreed value policy would pay you $50,000. More importantly, a partial loss an Agreed Value policy replaces most items on a "new for old" basis - with little or no depreciation, depending on the carrier. Hence, a claim for a stolen four-year-old GPS would get you a new, comparable replacement GPS.
"Actual Cash Value" policies cost less but only pay up to the actual cash value at the time the boat or property were lost - depreciation is factored in on all losses. Actual Cash Value policies are better suited to less expensive boats or when you aren't so concerned about a total loss.
- Windstorm Deductible: This can be good or bad. It provides incentive for the owner to take precautions to avoid a storm, or minimize potential damage in a storm. The owner assumes a level of risk if the vessel is damaged by a named storm. The addition of a Windstorm deductible can decrease premiums by sharing the risk- they are often in the 5-10% range.
- Tell your agent all your concerns- let him work for you to obtain the right carrier for your personal situation. If you have significant assets, you may want to obtain a personal umbrella policy that can cover you both on and off your vessel, if you have the proper underlying coverage on your boat.
- Surveys: Older boats will most likely need a survey, at least no more than two years old. Carriers like to see a well found vessel in good condition.