What do I ask when I’m looking for boat insurance?

  • If something happens to my boat how much money do I get?

It is extremely important to verify the policy type with your insurer. There are two kinds of policies available: Actual Cash Value and Agreed Value. These terms refer to how the insurer will calculate the maximum payout in the event of a loss.

Actual Cash value means that the insurer will apply depreciation to the replacement value of the vessel to determine the maximum settlement amount, so you may not receive the full value listed on your policy. To determine the depreciation amount the insurance company will consider all of the following:

– Condition of the vessel immediately prior to the damage,
– Re-sale value of that vessel and,
– Normal life expectancy of the vessel.

Agreed Value means that the insurer agrees to pay the full value listed on your policy declarations page in the event of a total loss; depreciation will not be applied. An Agreed Value policy is the better option and provides you, the insured, with peace of mind knowing that your investment is protected.

  • If I hit a rock and damage my lower unit, do I get new parts or aftermarket or rebuilt parts to fix it?

Not all insurers will replace your old parts for new ones after a loss occurs; many will repair/replace with aftermarket or rebuilt parts. When obtaining quotes it is always a good idea to ask a company about their ‘Basis of Claim Settlement’ clause to verify what that company will provide for you.

  • If I choose not to lock up my boat or trailer or I forget one day and my boat is stolen will it still be covered?

Many companies will have ‘Lock Warranties’ or ’Theft Restrictions’ listed in their policy wordings that indicate specific conditions that must be met for coverage to apply. For example some will dictate that your boat must be locked in a specific way, or stored in a locked facility at all times or that there must be signs of forced entry for any theft coverage to apply. We don’t. Although, we do agree that it is very important for everyone to protect their vessel(s) to the best of their ability and we recommend that they take as many precautions as possible to prevent the theft of their property.

  • Can I use my boat for watersports? What happens if someone gets hurt?

Be sure to ask if Watersports Liability is included in the policy wordings. Some companies will not offer this coverage at all and some will only offer it on specific styles of vessels. It is a good idea to confirm whether or not this coverage will apply to you and your vessel. Secondly, you should also verify the limit of insurance under this coverage. It is a good idea to carry a minimum of $1,000,000 coverage however $2,000,000 would be preferable. We automatically include up to $2,000,000 coverage for watersports liability on all types of vessels.

  • Does this policy include wreck removal and accidental pollution liability?

If your boat is in an accident, or sinks, and leaks oil or gas into the waterway you are not only responsible for the recovery of your boat but also for the environmental clean-up unless coverage is provided under your insurance policy. It is a good idea to carry a minimum of $1,000,000 coverage however $2,000,000 would be preferable. Our policies include up to $2,000,000 coverage for environmental liability, including wreck removal.

  • What happens if another boater hurts you and they don’t have insurance?

Boat Insurance is not mandatory in Ontario and as a result there is a higher chance of injury caused by an uninsured vessel because people simply don’t purchase it. Without having uninsured boater coverage on your policy any compensation for your injuries would be limited to the monetary worth of the individual who injured you. This could lead to very little compensation for your injuries, you having to pay for your own medical expenses, or worse yet, you could be left without an income if you are unable to return to work. If the uninsured boater coverage is included on your policy you would have coverage up to the limit stated on your policy declarations page. It is a good idea to carry a minimum of $1,000,000 however $2,000,000 would be preferable. We included up to $2,000,000 for uninsured boater automatically in our policy wordings.

  • Does the policy cover Emergency Towing?

Emergency towing is a nice coverage to have included on your policy, it acts as a little extra peace of mind knowing that if you become stranded compensation is available for some or all of your costs. Some policies will automatically include this coverage, sometimes it may have to be added separately and some companies won’t have this coverage available. Our policy includes coverage up to $5,000 for on-water emergency towing as we recognize the convenience and relevance of having this coverage.

  • If I have a claim on my boat does it affect any of my other insurance policies like my house policy?

It is important to find a marine policy that is not attached to any other policy in any way. Marine insurance typically gets attached to a home insurance policy, or written as an extension of the home policy, and if a claim occurs, the premium will not only increase on the marine insurance, but the home insurance as well. It’s also good to keep in mind that companies who typically write home and auto insurance, tend not to specialize in marine insurance. Although their intention is to be helpful they simply cannot provide some of the extra coverage's or knowledge that a marine specific company would automatically have included on their policy. We are marine specialists, it’s all we do. By purchasing a stand-alone marine policy through our office you are not only getting the separation of risk from any other policy, but also a special product, more tailored to boaters needs.

For more information please visit North Star Insurance