Jet-setting over the open water, sailing far out for deep sea fishing, or hosting intimate gatherings on a yacht are just a few of the perks of owning a luxury watercraft. While there aren’t as many types of boat insurance as there are types of watercraft, coverage for bodily injury, property damage, and theft is still essential.

Do Homeowners Insurance Policies Cover Boats and Watercrafts?

Homeowner’s insurance only offers meager coverage for watercrafts damaged by hail, fire, wind, vandalism, etc. However, these policies often have numerous exclusions and caveats. For example, some will not pay for hail damage to boats that are outside. They usually only trigger when the building housing the boat suffers from a covered peril, such as hail breaking the glass windows and subsequently damaging the boat. Homeowner’s insurance offers some coverage for stolen vessels, but most carriers cap this at $1000. It also rarely provides liability coverage, which can leave boat owners in a lurch if their vessel does damage to others.

What Does Boat Insurance Cover?

Many boat insurance policies offer all-risk coverage that covers any peril not omitted. Typical boat insurance policies provide coverage for the following:

  • Bodily injury liability
  • Property damage liability
  • Guest passenger liability
  • Damage due to a collision, lightning, fire, vandalism, and theft
  • Medical payments for the policyholder and passengers

Boat owners should also review their policies for coverage gaps. Many insurers offer add-ons to address these limitations, including:

  • Consequential damage for losses caused by wear and tear.
  • Towing coverage for transporting inoperable vessels.
  • Salvage coverage to remove catastrophically damaged boats (i.e., sunken or non-towable).
  • Uninsured boater coverage for injuries and property damage caused by an at-fault boater that doesn’t have liability insurance.
  • Coverage for personal items, such as stolen fishing equipment.

Actual Cash Value Versus Agreed Amount Value

Boat owners have two options for how their policy covers damages or losses. Actual cash value policies payout based on the value of the watercraft at the time of the damage or loss. For example, if a five-year-old boat sinks, actual cash value policies assess the existing worth of the vessel based on its condition and depreciation. In contrast, agreed amount value policies pay a specified amount agreed upon between the insurer and the policyholder without accounting for depreciation.

Windermere Insurance Group understands the nuances of insuring all types of watercrafts, from jet skis to luxury yachts. Contact us to design a comprehensive insurance policy customized to your specific needs.