insurance

6 things to know about boat insurance

Boat
Highlights
  • Homeowners insurance may not provide enough coverage for your boat.
  • In some ways, boat insurance is a mash-up of home and auto insurance.
  • Your boat policy does not apply when the boat is out of the water.

There's nothing quite as exhilarating as boating: the wind in your hair, the thrum of the wake against the hull, the snap of the mainsail and the buzz of an outbound fishing line.

It's no wonder 75 million people in the U.S. participate in recreational boating, according to 2010 data from the National Marine Manufacturers Association.

Where there are boaters, insurers will surely follow. A wide range of property and casualty companies offer boat insurance, including Allstate, Geico, The Hanover Insurance Group, Progressive, State Farm and Travelers.

It's easy to feel over your head when it comes to obtaining the proper insurance for your boat. That's because boats are a bit of an odd duck in the insurance world: Insuring a runabout has much in common with buying auto insurance while insuring a million-dollar yacht more closely resembles buying home insurance for a small house.

We assembled three knowledgeable insurance experts to answer six important questions about boat insurance.

Why do I need boat insurance?

If you're new to boating, you may be under the impression that your homeowners insurance will magically stretch to cover your boat. Sadly, in most cases it won't.

"Many homeowners policies will have a minimal amount of coverage for really small boats with either no engine or a very small engine, like a sailboat," says Mitch Jawitz, vice president of marketing and distribution at The Hanover Insurance Group. "But if you're buying a $10,000 or $20,000 boat, your homeowners policy is not going to cover you for what you need."

Lynne McChristian, the Florida representative for the Insurance Information Institute, says boats are unique and require their own policy.

"Your boat has nothing to do with your home, any more than your car can be covered under your homeowners insurance," she says. "Your home isn't mobile. Your boat, like your car, can go anywhere, so it requires a separate policy."

That said, you may save money by bundling your boat policy with your home or auto insurance.

"There's often a cross-sell discount," says Chantal Cyr, vice president of product management for Travelers. "At Travelers, if your boat is less than 30 feet and you have one or more policies, you can save 10 percent for one policy and 15 percent for the second."

How does it differ from home or auto insurance?

In some ways, boat insurance is a mash-up of home and auto insurance.

Like home insurance, a boat policy covers you for liability if someone is injured on your craft and gives you the choice between replacement cost or cash value in a total loss.

Like auto insurance, boat coverage typically includes coverage for bodily injury that your boat inflicts on others, property damage your boat inflicts on docks and other boats, and physical damage to your boat should you hit something or run aground. You can also purchase comprehensive coverage against theft, vandalism, fire and flood, personal property coverage for your fishing gear, uninsured boater insurance and even roadside assistance in the event you need a tow.

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