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6 Myths about Boat Insurance

PDestroyed Boaturchasing a boat and maintaining it is quite costly. The last thing you need is something to happen and you lose both your boat and/or all the money you invested in it.  If you own a boat or planning to buy one, then, for sure, you have come to know about the existence of boat insurance.  But what is boat insurance? Is it required? Is it worth? What is it for? Here are a few tips:

Boat insurance is not required

Indeed most states in US do not require that you insure your boat. You should check if the specific state where you keep your boat is not one of the states that actually do require boat insurance. In addition, there are other instances when insurance is not optional. Generally, if you took a boat loan your financial institution will ask you to insure the boat. Some marinas and dry storage facilities will also not accept your boat unless it is insured.

I only need boat insurance during the months I am using my boat

Damaged BoatWhether your boat is on water or on a dry dock there are many risks that remain – flooding, vandalism, fire, and damage to equipment on board such as fishing or navigation gear.

Boat insurance is same as car insurance

Sunken BoatThere are many similarities between boat and car insurance.  However, there are a lot more cars on the road than boats in the water. Over the years federal and state regulations have enforced many types of coverage as mandatory in any type of car insurance. The case with boats is different – not all insurance types will cover things like dock damage, damaged equipment, flooding, etc. Read your boat insurance terms carefully and make sure you understand what exactly is covered and what is not.

The best place to get boat insurance is the company that insures my car

Boat on FireIn general, most companies will give you a discount if you have multiple policies with them. However, a good car insurance company does not necessarily have good boat insurance coverage. In order to get the most out of your money, make sure you check several insurance companies, compare what types of coverage they provide and of course, how much is going to cost you.

My boat policy has comprehensive package so even in case of a natural disaster I will be covered

Boats after a hurricaneThis depends on the specific language used in your insurance policy. Some companies have special clauses, deductions, and exclusions when it comes to named natural disasters such as hurricanes and tropical storms. Check with you insurance provider to find out if you are actually covered.

Insurance premium depends only on the value of the boat

The value of your boat will, of course, reflect on the price you will have to pay for insurance. There a few other factors, however, which you insurance company will take into consideration. Boat size – in general, the bigger the boat, the more you will pay. Place of operation – insurance companies rate the risk of incidents based on where you sail your boat – most likely you will get a different rate if you sail on a quiet lake compared to sailing in the Atlantic Ocean.

Demolished BoatIt is up to you to decide whether or not you need a boat insurance.  If you choose to buy one, make sure you get a policy that covers everything you need, so that life does not catch you unprepared.