Messin’ Around in Boats

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When it comes to insuring boats, coverage can be tricky and inconsistent. Some insurance companies sell a marine policy for boats which is no more than a glorified auto policy. The rates are great-but the coverage is not. All policies will cover you if the boat sinks, or if you have a fire or collision,  but the more streamlined  policies may not cover  some of the more subtle losses which could turn out to be big claims. I ran across one company that excluded losses resulting from a “latent” (hidden) defect within the boat. The loss involved a gas tank which  severed from metal fatigue-spilling gasoline throughout the bilge. Luckily it was discovered before an explosion or fire occurred. Since the policy excluded damage resulting from the latent defect, The cleanup was not covered and if the boat exploded there would also be no coverage. The better policies would have excluded the defect itself (the gas tank)-but cover the resulting damage. The policy wording can make a big difference in the extent of coverage provided. The moral of this blog is that it is important to buy yacht insurance from a company that specializes in marine coverage and has the depth (no pun intended) of coverage necessary to address losses that are specific to boats. This will make for happy motoring-or sailing.

The author of this blog, Guy Hatfield CPCU CIC, can be reached at 203.256.5660.

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