Boat Insurance

Keep Your Head Above Water

Research shows that being near water makes us happier. It’s no wonder why people flock to coastal cities. But there’s one thing that may ruin your sailing – a boat accident. Boat accidents are not as uncommon as you may think. That’s why, to keep you from drowning in the financial expenses incurred by boat accidents, you need to learn about boat insurance.

In this article

Why Do You Need Boat Insurance?

Only two states require you to have a boat insurance policy — Arkansas and Utah. If you are in either of those states and have a powerboat, you are required by law to have liability coverage in place. However, even if your state law does not mandate boat insurance, it’s common for your creditor, marina, or boating event organization to require you to be protected by boat insurance. In case of accidents, they do not want any losses to be on their account.  

Speaking of accidents, 2019 Recreational Boating Statistics reports that the US Coast Guard recorded 4,168 accidents, including 2,559 injuries and 613 deaths. Moreover, the damage to property amounted to around $55 million. Both the number of injuries and accidents increased by 1.9% and 0.6%, respectively, compared to 2018 data.   

Boat insurance is a financial safety net for you. It not only covers losses due to gratuitous damages to your boat but also protects you from any liabilities that may follow. In general, boat insurance covers property damage to your boat, liability for bodily injury, and property damage of third parties.  

Which Type of Boat Insurance Do You Need?

Depending on the type of boat you own and your needs, you can choose from different boat insurance options.

Personal Watercraft (PWC) Insurance

A PWC insurance policy indemnifies you for towing, wreckage removal, fuel spill liability, and more. This insurance is for houseboats, pontoon boats, sailboats, or any other craft that falls under personal watercraft. PWC insurance covers you and your watercraft against losses due to accidents, liability, and even vandalism. Your insurer may even cover losses to your watercraft when someone else uses it with your permission.

Yacht Insurance

Typically, yachts are used to travel farther than personal watercraft. As such, yachts have a set of unique risks. Therefore, coverages under yacht insurance are broader and specialized. Yacht insurance indemnifies you against liability claims (bodily injury and property damage to others) and personal property damage to your pleasure boat.

Sailboat Insurance

As per your discretion, you can get collision and comprehensive coverage under sailboat insurance. The insurance policy can cover vessel replacement, vessel repairs, wreckage removal, fuel spills liability, etc. However, there are some limitations, such as no compensation if you use sailboats as a primary residence or if your sailboat does not meet the US Coast Guard standards.

Boat Club Insurance

If you operate boat clubs such as Carefree Boat Club, Boatsetter, or SailTime, boat club insurance is your subject of interest. Since a boat club has a variety of boats like small motorboats, sailboats, yachts, and personal watercraft, you’ll need insurance for inland buildings, docks, and marinas. And that’s just what the boat club insurance offers. In addition to that, it also offers workers compensation coverage, crime coverage, and much more.

There are many more options you may find. Talk to your insurance agent or start by getting a quote from our insurance carriers.

Keep yourself from drowning in financial trouble.
Sail away! Get a quote for your boat!

Coverages of Boat Insurance

Your boat insurer may offer coverage for the following:

  • Damage to your boat
  • Damages from uninsured/underinsured watercraft
  • Injury during water sports
  • Medical payments for injuries to boat owner and passengers
  • Fuel spill liability
  • Damages to expensive equipment like fishing gear and other personal effects
  • Hurricane haul-out coverage
  • On-water assistance and towing required due to breakdowns
  • Ice and freeze coverages
  • Emergency services such as battery assistance, oil, fuel deliveries, towing, etc.
boat insurance 2


To better cover yourself and your boat, you can add endorsements to your standard boat policies. The most common endorsements are:  

  • Specialized coverage: For specific property on your boat, such as navigation equipment, an expensive propeller, etc.  
  • Salvage: Cost of raising or moving your boat to a safe location after sustained damage.  
  • Consequential Damage: Expenses due to wear and tear of your boat leading to mold, corrosion, rot, etc.  
  • Towing: Costs to trail or tow your boat to safety.  
  • Cruising Extension: To temporarily extend territorial coverage to cover you while sailing in areas otherwise not included in your standard policy.

Keep yourself from drowning in financial trouble.
Sail away! Get a quote for your boat!

What are the commonly
covered perils?

Your insurer may cover any losses caused due to the following perils:

  • Sinking  
  • Fire  
  • Collision 
  • Capsizing  
  • Theft  
  • Stranding  
  • Explosion  
  • Storms
boat insurance 3

Things to Consider Before Buying Boat Insurance

While purchasing boat insurance, people often overlook three important issues:

Value Coverage

Understand whether your insurance provider offers an Actual Cash Value (ACV) or Agreed Value (AV) coverage. As the name suggests, under an AV policy, you and your insurer agree on your boat’s value. Upon the event of complete loss, your insurer will compensate as per that agreed value.

On the other hand, under an ACV policy, your insurer will limit compensation to the boat’s actual value. The actual value is calculated by factoring depreciation, wear, and tear. ACV policy is cheaper than AV policy.

Lay-up Period

Your boat is exposed to potential damage even when it is off-water. For instance, during a storm, a giant tree may fall on your boat, causing damage. If your boat is not covered during off-seasons, you may have to bear the repair costs. Hence, get coverage for your boat during off-seasons too.

Navigational Territory

You have to be aware of the nautical territory accepted by your insurer. Your insurance policy can only provide coverage for specific locations in water. So, talk to your insurance agent and clearly understand the coverage limits. If you navigate and get into any accident in territories not specified by your insurer, you may not receive any compensations for the losses.

So next time you get on your boat — for fishing, cruising, or sailing — wave away your worries about boat damages. Happy sailing!

What affects the cost of my boat insurance premium?

Your boat insurance premium is calculated after considering factors such as your ownership, operational area, the make, model, age, horsepower, length, primary construction material, propulsion and value of the boat, primary cruising area or navigational territories, etc. Deductibles (the amount you pay before your insurance policy kicks in) also affects your premium. The higher the deductible, the lower the premium.

Can I get boat insurance via my homeowners or renters insurance policy?

If you have small crafts like canoes, small powerboats, or small sailboats with no more than 25 mph horsepower, you can get coverage under your renters insurance or standard homeowners policy. However, most insurers cover only limited property damage and usually exclude liability coverages. Nevertheless, you can add an endorsement to your homeowners policy to extend the coverage.

What types of boats are insured?

You can find boat insurance for runabout boats, kayaks, cruisers, houseboats, yachts, sailboats, sport boats, jet skis, canoes, etc.

Will my boat be covered if someone else uses it?

Most of the policies allow anyone to sail your boat, given that you permit them to use it. However, there may be exceptions, especially when it comes to personal watercraft or high-performance boats. So, the best thing to do is clarify with your insurance provider. Also, remember that several additional drivers may increase your insurance premium.

Keep yourself from drowning in financial trouble.
Sail away! Get a quote for your boat!