Insurance Corner: Common mistakes made purchasing boat insurance

by Martha Marton

Boat policies are not all the same. Because there is not a standard boat policy, you should review your policy closely and discuss with your broker anything that you do not fully understand.

Check whether your policy has Agreed Value or Actual Cash Value Coverage for your Hull Coverage. Agreed Value is a number that represents fair market value that you and the insurance company agree upon. If you suffer a hull loss, your payout is the agreed value without deduction for depreciation. If you have Actual Cash Value, the insurance company will factor in depreciation at the time of loss before the payout so you could receive much less.

Look at your liability clause and note whether you have Protection & Indemnity (P&I) or Watercraft Liability: Protection and Indemnity is the broadest coverage. It covers your hired crew, wreckage removal, and negligence if your boat is not seaworthy, bodily injury and property damage. Watercraft Liability only covers bodily injury and property damage.

Be sure you have All Risk Coverage rather than Specified Perils: Coverage for All Risk is much broader than Specified Perils, which will cover only the perils listed.

Policies are rated in part by where you will be taking the boat. If you take the boat into ocean waters and your boat is rated for navigation of Lake Simcoe, your insurance would be deemed null and void in the event of a loss. If you are planning a trip outside of you usual navigation area, be sure to let your broker know before your departure.

By carrying a higher deductible, you can save a considerable amount on your annual premium; a lower deductible can be carried for electronics, personal property, and tenders.

Be aware of any warranties in your policy. A warranty is a contractual promise that you make when you take out your policy. If you add a propone tank or use your personal boat to earn money delivery goods, and your policy has a warranty clause that says you won't- no coverage.

If you really only use your boat during the summer months, consider a longer lay-up period for a lower insurance premium. There is no point in paying for use you are not enjoying.

Insurance companies often offer a credit for safety courses you have taken and safety equipment you have on board. Be sure to keep your broker updated as you take additional boating safety courses and add equipment.

For more information, contact Martha Marton at Tupling Insurance Brokers Ltd. 705.458..8111 marthamarton@tuplinginsu rance.com