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Understanding Boat Insurance

Our knowledgeable team combine their expertise in sourcing the right insurance cover with their passion and experience of the marine world to offer our clients a first class service. With a range of boat or yacht insurance policies available, we have broken boat insurance down into two main groups that will make it easier for you to understand what cover you need.


Liability Insurance

Sometimes referred to as protection and indemnity insurance, these insurances cover your liability to third parties if bodily injury, death or damage to third party property occurs as a direct result of you owning or operating your boat. They also help to pay any legal fees that may arise if you are sued for a liability covered by your boat insurance.

An extensive boat insurance policy that includes liability insurance should be essential for all boat owners. As a boat owner and operator, you will be solely responsible for the clean up and containment expenses that may arise from an oil spillage or contamination caused by your craft. You will also need to be covered for the disposal and removal of the wreck if your boat were to capsize. This type of insurance policy is required under General Maritime Law for any boat that employs paid crew members.


Physical Damage Insurance

This type of policy will cover against loss or accidental damage to your boat and its machinery, including the hull, engine, sails and any other equipment that is used to operate the boat.

Causes of loss can be wide ranging, but most relate to weather conditions including wind, rain, lightning, hail and damage caused by waves or collision. Vandalism, fire and theft are also major causes of insurance claims being made. Exclusions may vary depending on your policy and mainly relate to general wear and tear.


Settlement of Losses

One of the major differences between boat and yacht insurance policies is whether settlements are based upon ‘actual cash value’ (ACV) or ‘agreed value’.

An actual cash value policy is generally cheaper but provides less coverage than an agreed value policy. This type of policy takes into account the condition of the boat and subsequent depreciation at the time of the loss, paying out a sum up to the current market value of the vessel. In addition, payments made for partial losses are also more than likely reduced to reflect the depreciation of the damaged or lost items. A policy deductible is also administered.

Agreed value policies, although more expensive, pay out the amount stipulated in the policy if the boat or yacht is regarded as being a total loss. Additionally, under an agreed value policy depreciation is not taken into consideration when calculating the value of the damaged or lost items, and damage that results from a partial loss is usually paid for on a new for old basis.  There are, however, some exclusions including those items that are generally subjected to substantial amounts of wear and tear, for example, sails, canvas, trailers and some types of machinery. These types of items may infact be subject to allowance for depreciation.


Cover for Medical Payments

It pays to make sure that your boat or yacht policy includes adequate cover should medical treatment be required for someone who is injured whilst on your vessel. Medical payment coverage will pay for ambulance and hospital costs, plus for costs incurred during first aid treatment, even if you are not deemed to be legally responsible.


Uninsured Boater Coverage

Many boaters operate without boat liability insurance as it is not a legal requirement. You can take out uninsured boater coverage which will provide compensation should individuals aboard your boat be injured as a result of an accident with another boat that is not covered by liability insurance. This coverage will enable you to claim damages from either a hit-and-run boater whose identity cannot be discovered, or an uninsured boater.


The Cost of Boat Insurance

In order to determine the cost of insurance premiums, we must take into account a number of different factors. These usually include the age of the vessel, its value, length, and type (power or sail), the place where it is moored, the intended area of navigation, the claim history of the owner plus their prior boating experience.

The age of your boat is an important factor when considering the cost of insurance premiums. Make sure that you keep essential systems well maintained and up to date whenever you look to insure your boat or yacht.

The majority of yacht policies incorporate a lay-up period. This refers to the time, usually during the winter in colder climates, when the yacht is out of action. It may also be possible to reduce your premium by installing specific safety devices on your boat including outboard locks and wheel clamps, anti-theft alarms, tracking devices, a fume or vapour detector in the bilge, and an automatic fire extinguishing system in the engine compartment.


For an informal discussion and a free quotation for your boat or yacht insurance, please call our Marine Team on 01202 754991. You can also obtain an indicative quotation by simply clicking on Get Quote above.

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Why choose Alan & Thomas?
  • Free no obligation review and quotation
  • Knowledgeable marine insurance experts
  • Competitive premiums from leading UK marine insurance providers
  • Insurance cover tailored to your specific requirements
  • In-house Claims Team to manage any claim for you
  • Top 100 UK independent broker* with Chartered Insurance Broker status

* Top 100 Independent Brokers 2014 published by Insurance Age in association with Cornell Consulting

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