BOAT INSURANCE EXPLAINED

Boat insurance is designed to ensure that your yacht, dinghy, canal boat Speedboat jetski or any other water-bound vessel is protected in the event of accident, as well as you, your passengers and anyone else that you may come into contact with.

Do you need boat insurance?While you might not ram another boat, run aground on a sand bar or ram a buoy, there are other boating dangers, such as:

• The boat sinking, which happens more often than not while it is docked

• Getting sued because of damage caused from your boat’s wake

• Being responsible for an oil spill, classed as an environmental hazard, which originated from your boat

• Paying for the medical bills if a guest is injured on your boat.

• Transferring an existing marine insurance policy to a new or replacement boat, unlike many car insurance policies.

Before you shop for cover

Boat and yacht insurance provides cover for any physical damage to the boat if it is accidentally damaged or destroyed through collision, fire, theft, vandalism or storm damage.

There are two types of physical cover that you can get: actual cash value and agreed value.

Actual cash value covers the replacement cost of your boat, less depreciation at the time of the loss.

Agreed value pays on the basis of an agreement with your insurance company on the total money value of the boat, minus some depreciation. Sometimes you can also take out a waiver so that the insurance payout is not reduced due to depreciation.

Other considerations

• Some policies offer medical payment protection which gives coverage for injuries suffered from an uninsured boater

• New-for-old cover for sails, masts and spars

• Emergency towing coverage, which reimburses you if your boat becomes disabled in the open water.

How to choose a policy

Choosing a policy from the wide range of out there can be quite a daunting prospect. Here are some pointers:

• Decide how much you are prepared to pay or can afford to pay if you have an accident. The higher your excess, the lower your premium.

• Consider whether actually want them or are you just looking for basic cover? Match your cover to the value of your boat.

• Boat theft is rife. The more precautions you take the smaller your premiums will be.

• Shop around but always compare like-for-like and don't be afraid of going back to your existing company and asking them to beat or match your best price.

• You can get up to 25% for a no claims discount after a few years, and discounts from other marine policies are transferable.

Other things that can reduce the cost of your insurance:

• Completing an accredited boat safety course

• Extended lay-up periods. Let the underwriter know if your boat is safely secured in an area protected from weather elements and thieves

• You might get discounts for carrying additional safety equipment such as a GPS locater, VHF radio and extra fire extinguishers.

How your premiums are calculated

Insurance costs vary widely depending on the boat, its intended use, previous claims, where it’s docked or stored plus the sailor’s own experience. It is almost impossible to give examples of how much insurance might cost.

Here are some things that underwriters will look for:

• Type and cost of your boat: age, size, type, power and equipment

• Intended use: personal, commercial or charter boat

• Experience operating a boat: Sailors with less than three years experience generally attract a surcharge

• Navigational plans: inland, coastal, cruising or racing

After you have taken out insurance

• Install inside hinges and deadbolt locks on all doors

• Secure ports and windows with inside auxiliary locks

• Attach inverted strong hasps and padlocks to all hatches

• Inscribe all valuables (including electronic equipment, your engine, sails, radios, binoculars and other loose gear) with your name, your home port, your driver’s licence number and your hull identification/serial number.

• Keep an inventory list ashore of all your gear. Include name, model, serial number, manufacturer and description.

• Think about installing an alarm as a deterrent to would-be thieves

• Always moor your boat to something secure with a chain or cable that can not be lifted over or torn loose from the piling or mooring.

• Consider leaving your engine out of commission when you are away. You could remove the rotor, install a hidden cut-off switch, drain the fuel, remove a spark plug or the propeller.

• Get to know the people and boat owners where you dock, and look out for one another. Insist on good lighting at your marina.

Let each other know if anyone will be using your boat when you are not present.

Final points to note

• Most policies only cover personal, non-commercial use. Any use for which a charge is made, whether paid or not, is not covered.

• Many policies will only cover you for certain types of sailing. If you want to cross the Atlantic with a boat that you typically use only for heading between one UK port and another, you will not be covered.

• Check your policy before allowing someone else to use your boat. They may not be covered.