Is Boat Insurance A Requirement?
Boat insurance is an important subject, but not everyone wants to pay for it. It’s an added expense for boat owners that no one wants to pay, but the decision isn’t typically an option. When you buy a boat, you purchase boat insurance. It’s the responsible thing to do, and it’s the safest thing you can do for your finances. No matter how great a driver you are, how safe you are on the water, and how safe you are towing your boat home and to the water, you’re only in control of your own actions. The actions of others are beyond your control, and someone else’s negligence could cost your family tens of thousands of dollars without boat insurance. It’s also important to note boat insurance simply isn’t an option in most cases. If you’re unsure whether you absolutely need it or you can get away without out, the following breakdown can answer those questions on your behalf.
If you purchase a boat with the help of a financial lender and make monthly payments to the lender, you are required by law to carry boat insurance from Youi. There is no fine print, no exception, and no way around this rule. Lenders are in the business to protect their own interests, and your boat is their boat until you make the final payment. As long as you have a boat loan through them, the lender requires you protect the boat and their asset or they’ll take action against you. You are free to find your own boat insurance policy with your boat company, but you must provide proof to the lender prior to leaving with the boat. If your insurance lapses, your lender finds out through the insurance company and requires you purchase a new plan without question.
Every state’s laws differ. No two states have the same boating laws, but many states do require some form of boat insurance is carried by all who own a boat. It’s called liability coverage, and it’s not an option. This insurance is in place to protect everyone who enjoys being on the water from the negligence of others.
If you are driving your boat one day and aren’t paying attention to the waterway, you could cause an accident with another boat, hit a jet ski, or even run into someone’s dock destroying it. If this happens, you are responsible for the cost of repairs for all damaged property, and all the medical bills for those who were injured during the accident. If you don’t carry insurance, you are personally liable for these things, and you can be sued by the party whose home or personal property you damaged or destroyed.
Liability insurance covers you if this happens. It provides proper payment to the victims of the accident, it helps cover the cost of their medical bills and any repairs they have to make to their property. It also helps you avoid personal liability in case you are sued as a result of the accident.
Some boaters feel they don’t need insurance on their boat for several reasons. It’s paid for, and they don’t take the boat on the road where so many accidents occur. They dock their boat at a marina where it’s safe from those who might not stop in time to avoid hitting the boat on the back of their truck. These boaters still need boat insurance. Marinas don’t allow any boater to dock their boat in their facility without boat insurance. It becomes a liability to the marina, and marinas don’t want that type of responsibility.
Say something happens to your boat while it’s stored at a marina. There was some sort of engine malfunction, and the boat catches on fire. The boat then burns down the entire marina and the three dozen other boats docked. The marina has insurance, but their insurance isn’t for instances such as this. A situation like this is for your own insurance to handle, which is why marinas don’t deviate or make exceptions to the rules in place regarding boat insurance.
Regardless what any other business requires in terms of insurance, you should purchase a policy. Your own finances are at risk each time you take your boat out, after all. If something happens to your boat, can you afford to make the necessary repairs on your own? Can you afford to replace your boat if it’s totaled? Can you afford to pay for any damage your boat causes to someone else on the water, the road, or even at home if your boat is not insured? For many boat owners, the answers to these questions are a resounding no. Boats are expensive, and paying for the damage to one is no exception.
If you’re shopping for an insurance policy for your boat, ask lenders about discounts available to you. If you have any formal boat training, certifications, or you have taken any boat or water safety classes, you are eligible for some insurance discounts. If you bundle your policies, you’re also eligible for some insurance discounts. It’s not always as expensive as you assume, but you should do your homework.