You may have a boat that you don’t own and you may be asking yourself, “can I insure a boat, not in my name”? This article has the answers.
If you’ve inherited a boat from a family member or you’ve received it as a gift from a friend, you may be wondering whether you can insure it, if it’s not in your name. Well, the answers are right here.
Only a registered title owner of a boat can purchase its insurance. Therefore, you can’t insure a boat that’s not under your name. So, if you have inherited a boat or received it as a gift and you want to insure it, you should first transfer its title to your name. After that, you can insure it.
In this article, we will walk you through the importance of buying boat insurance, the different types of boat insurance available, as well as the different coverages offered. Also, we will answer your question as to whether you can insure a boat that’s not in your name.
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Overview
Your boat is one of your most valuable assets. Also, it’s your ticket to endless fun in the water with your friends or family. So, whether you own a fishing boat, a yacht or any other type of boat, it’s important to protect it, to make sure you can continue enjoying the beautiful outdoors. And this is where boat insurance comes in.
Why You Need to Buy Boat Insurance
Some people assume that they don’t need to purchase boat insurance separately, since it may be covered under their homeowners' insurance policy. However, as much as some insurance providers offer boat insurance under home insurance, the insurance coverage for the boat is usually subpar.
For instance, if boat insurance is offered under the homeowner's policy, it will only cover boats up to a certain size. So, if your boat exceeds the set length, it will not be eligible to be covered.
Simply put, the boat insurance covered that may be offered under the homeowner's insurance policy may not be sufficient, especially for motorized or larger boats. Furthermore, some insurers will only cover your boat if it’s damaged when sitting on your property. So, if the damage happens when it’s out in the waters, you will be on your own.
With this in mind, it will be highly advisable to buy boat insurance separately. As much as your homeowner's insurance policy may state that it also covers your boat, the coverage offered may not be adequate for your needs.
So, if you own a boat, make sure you purchase a separate insurance cover for it. When it comes to insurance coverage, you would rather have it and not need it, rather than need it and not have it.
Types of Insurance Coverages for Boats
When it comes to insurance coverages for boats, you will come across two main types. These are cash value boat insurance coverage and the agreed amount value boat insurance coverage. Let’s take a closer look at each of these two types of boat insurance coverages.
Cash Value Boat Insurance Coverage
If your boat has this type of insurance coverage, your insurer will only pay its value or the equipment it may contain, at the time of the damage. For instance, if your boat collides with another boat and it's written off, your insurance will assess its worth at the time and then pay you a figure based on its current market value.
Agreed Amount Value
If you opt for this type of coverage, you will negotiate with the insurer and settle on a certain figure, which you deem to be the boat’s worth. But, you can expect to pay higher boat insurance premiums for this type of coverage as well as higher deductibles. On the flip side, if your boat is written off, the insurer will write you a check for a new one, regardless of how much the boat may have depreciated.
For instance, you may have purchased a boat in 2020 and purchased the agreed amount value coverage. If you were to file a claim in 2022, you will receive a payout equal to the boat’s worth in 2020 when you purchased its insurance coverage, even if it may have depreciated.
Cash Value vs. Agreed Amount
Between cash value coverage and agreed amount value, which type of coverage should you choose? Well, this will depend on the boat’s condition and its usage. If you have purchased a new, large boat, then you should opt for the agreed amount value policy. On the other hand, if you purchasing insurance for a boat that has seen better days, then you should simply opt for cash value.
What’s Covered by Boat Insurance
Just like auto insurance, boat insurance offers different types of coverage. Here are some of the different types of coverages that come with boat insurance.
Consequential Damage
This coverage is designed to protect your boat against wear and tear, which may not have been caused by an accident. For instance, damage caused by mold, corrosion or rot is quite common in marine environments. And, it can be quite expensive to repair. And this is where this coverage comes in.
Collision Damage
As its name suggests, this coverage will help to offset costs related to replacing or repairing your boat, if it has been involved in a collision. As much as this type of coverage may be offered under your homeowner’s insurance policy, it usually doesn’t cover towing or wreckage cleanup expenses. If this is the case, you will need to purchase an additional layer of protection known as salvage.
Salvage
Salvage will cover the expenses for the towing or wreckage removal of your boat if it has been damaged in such a way that navigating it back to shore safely is impossible. Towing a boat costs approximately $400 per hour. As you can see, the costs can add up quite fast, especially if your boat is wrecked further away from the shore. Therefore, it will be highly advisable to add this type of coverage to your boat insurance policy.
Personal Property
Personal property will protect your belongings or valuables inside the boat, in case of fire, theft, or vandalism. This type of coverage will be highly recommended for boat owners who use their vessels as temporary or permanent residences, since such boats may contain valuable assets like electronics and furniture.
Injury
If you are at fault for a boat accident that results in injuries, this coverage will help to cover those costs. It will cover the victim’s medical bills, legal expenses, medications as well as pain and suffering, among others.
Specialized
This coverage is designed for specific items that you may be storing inside your boat like fishing tools, anchors or navigational equipment. In case such items are lost or stolen when you are out on the water, this coverage will take care of their replacement costs. But as you may expect, the more items that you intend to be covered, the higher the premiums you will pay.
Cruising Coverage
Cruising coverage is more like travel insurance for your boat. It’s designed to provide coverage for your boat if you will be leaving the U.S in it. For instance, if you will be exploring the British Virgin Islands or you will be vacationing in Mexico with your boat, this insurance will cover you in case of any unexpected situations.
Can I Insure a Boat Not In My Name?
To purchase boat insurance, you will need its title. And if the boat’s title is not in your name, then you can’t purchase insurance for it. In case you’ve inherited a boat or you’ve received it as a gift from a family or friend, you should first transfer its title to your name. Once you’ve done that, you can then insure it.
