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A pirate looks at boat insurance

By Jay MacDonald ·
Tuesday, June 1, 2010
Posted: 9 am ET

Here in Florida, if you’re nautical by nature, you can get a rush just walking the docks and checking out the clever names on the sterns of the pleasure fleet.

Naturally, Jimmy Buffett references rule down here, with 5 O’Clock Somewhere, A Pirate (or Parrot) Looks at 40, Changes in Latitude, Shaker of Salt and other Margaritaville shout-outs being the most common.

Buffett-isms are beachy and all, but my favorite "nom de mer" is still Tony Soprano’s Stugots.

If you’re Havana daydreamin’ about a boat, it’s a good idea to check into boat insurance first so you can factor that cost into the money you’re about to throw in the water. ... uh, I mean invest. Geico, Progressive, Allstate, State Farm and many other insurance companies will happily underwrite your policy.

Though the coverage is similar to auto insurance, a boat policy has some unique twists.

The three main components of boat insurance will sound awfully familiar to landlubbers. Bodily injury liability covers you for injuries your boat inflicts on others. Property damage liability covers the damage your boat inflicts on other boats, docks or structures. Physical damage covers damage to your boat and trailer if you hit something, run aground or back into a Wendy’s.

As with car insurance, you can purchase comprehensive coverage against theft, vandalism, fire and flood, personal property coverage for your fishing gear, uninsured boater insurance (lest one of these collides with Aquaholic) and even roadside assistance in the event you need a tow.

Unlike auto insurance, boat insurance comes in a rainbow of flavors; names 15 varieties, including powerboat, sailboat, houseboat, bass boat, personal watercraft and so on, each with its own set of features. Did you know that sailboat insurance is mandatory in the U.S. but powerboats are as unfettered as Free Willy? Check the requirements for your frigate before you cast off.

Two warning flags to be aware of when purchasing a policy for the Hasta Manana:

Replacement cost: You may have the choice of selecting actual cash value (market value), agreed value (an amount you set when you purchase the policy) or full replacement cost when you purchase your policy, and each will affect your premium. Crunch the numbers to determine your fish-to-funds ratio.

Exclusions: Boat policies vary widely and often exclude things like defective machinery and personal watercraft such as jet skis or dinghies. You may want to consider additional coverage for excluded items.

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Jay MacDonald
June 03, 2010 at 1:05 pm

Hi, Jeremy:
The information comes from Steve Wyrostek at Here's the page link:

June 02, 2010 at 7:10 pm

Would you provide a reference to the "mandatory insurance requirements for sailboats"? USBoat, a major marine insurer states "To the best of our knowledge there are no state or federal laws that require a boat owner to have insurance on a boat. However, if you have a loan using the boat as collateral the bank will require insurance coverage..."

It isn't a state requirement and a google search didn't turn up any federal requirements other than this article.