Evaluate Your Needs

Are you a die-hard fisherman, or more of the cruising type? Is your boat built for speed or comfort? Do you navigate in coastal waters, or stick to inland lakes and streams? Do you entertain on your boat, or do you prefer solo trips? How, and even where you use your boat can affect the type of coverage you need, so be sure to consider your boating lifestyle when choosing a policy.

Some insurance companies offer no-frills boat coverage that is simply added to an existing auto or homeowner’s policy. While this option sounds good in theory, and the premium may be attractive, be wary and read the fine print. Most boat owners will be best served with a boat-specific policy, rather than an add-on to an auto or homeowner’s policy.

Think about it—not only is your boat a serious investment, it operates in a unique environment. Boat policies take into account marine-specific risks auto and home policies do not, such as fuel spillage, wreckage removal, on-water towing, or fishing gear coverage. A knowledgeable, boat insurance agency can review your options and help you tailor coverage to meet your specific needs.

Confirm Your Total Loss Settlement Coverage

The most significant difference between insurance policies is whether the loss settlement basis is "Agreed Value" or "Actual Cash Value." Agreed Value policies pay the limit stated on the policy when the boat is deemed to be a total loss. An Actual Cash Value policy will pay only the current market value of the boat, factoring in depreciation. An Agreed Value policy offers more protection and therefore, generally costs more. Note: Some lenders may require you to carry Agreed Value coverage. Be sure to check your lender.

Ask Your Fellow Boaters, and Seek Out a Specialized Policy

In the event of a claim, you will appreciate a company that offers specialized coverage and claims handling. Ask your fellow boaters for insurance company recommendations or find an independent insurance agent who understands boat policies.