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Author: Mansi Gupta
Deciding what kind of boat insurance coverage
you need depends on many variables. To start
off, the type of insurance you need depends
on what kind of boat you have. Being familiar
with boats you would need to look at the different
variations between the various types of boats
that are in the world.
For instance, a speedboat capable of high speeds
requires a much different type of insurance
than a small fishing vessel would because of
the potential liability for the insurance company
that comes with a speedboat compared to a fishing
boat.
Another consideration is the value of the boat.
Insurance rates covering a highly expensive
craft are going to be higher because the amount
that could be lost is much higher. If instead
you are watering a small, low cost boat and
you want coverage against damage to other boats
that you may come in contact with, then the
rates would be much lower,
There are many similarities between boat and
car insurance. Risk assessment for an insurance
company is based on many factors with car insurance
just the same with boat insurance. Before an
insurance company will offer any kind of coverage
for a water craft they will make sure to determine
all the possible ways that the coverage could
cost them money. To do this they will take the
age of the boat, the record of the owner and
primary driver, the value of the boat and the
area where the boat will he housed for at least
six months out of a year.
Just like automobile insurance, there are two
distinct types of boat insurance. Full coverage
insurance is just like it sounds, it covers
pretty much everything including loss due to
theft, fire, accident, and many other types
as well. There are several clauses involved
in full coverage insurance that work to limit
the liability that the insurance company will
need to cover that these are par for the course
with an insurance company. Full coverage insurance
is normally mandatory when you finance a boat
or a car for that matter. This is in place to
protect the bank against loss should anything
happen to the boat before it is paid for. Full
coverage insurance is the most expensive of
all insurance plans as the risk to the insurance
company is the greatest with this type of policy.
When financial loss will not be great and a
budget is stretched a little thin then you may
want to consider liability only insurance. Under
a liability only policy, the insurance company
is responsible to pay for only damage to other
persons or property and the owner of the boat
receives nothing. This is the basic insurance
required by law for cars and in some areas it
is required for boats as well depending on the
size and usage of the craft. This type of insurance
does not protect against loss of any type and
will pay only a specified amount for injured
persons in the case of an accident.
You should check your local laws requiring
insurance on watercraft to be sure that you
are staying within the parameters.
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