Boats can sometimes sink for a variety of reasons, including while you are operating them or even when they are safely moored at a dock or marina. Depending on the insurance plan you have, your boat insurance may or may not cover sinking. Let’s examine when and how sinking a boat is covered by insurance.
Does Boat Insurance Cover Sinking?
Yes, sinking is typically covered by boat insurance. A listed peril should typically be covered by your boat insurance, and your policy might also pay some of the costs of salvage and removal. Fire, robbery, storms, and vandalism are a few examples of risks that are frequently covered. So, your provider should cover your boat as long as you have some form of comprehensive or full boat insurance policy.
How Does Boat Insurance Cover Sinking?: The Types of Claims
Insuring your boat for its actual cash value is typically the most affordable option. The actual cash value of your vessel is the price at which it was purchased at fair market value. In reality, the actual cash value does not account for depreciation, so as your boat gets older, your coverage will gradually decrease.
Additionally, you might insure your boat for a predetermined or agreed-upon amount, often known as hull value. Here, you and your service provider agree on a sum, and your insurance company will reimburse you for it if your boat sinks, regardless of how old it was when the damage occurred. A frequent type of insurance, agreed-upon value coverage is typically more expensive than actual cash value insurance.
You might be able to obtain the entire replacement cost or guaranteed replacement cost coverage for brand-new boats. Most likely, this will be the most expensive choice. If you have a total replacement cost included in your policy, your insurer will be able to replace your damaged boat with a brand-new one of the same make and model in the event of a covered loss. Typically, only boats that are less than a year or two old can avail of this.
Exclusions to Keep in Mind
Location-based exclusions: Most insurance packages have a set cruising distance. They won’t cover you if you sink if you take your boat outside of specified waters without additional coverage.
Seasonal exclusions: Specific restrictions on when the boat may be in or out of the water may be applicable if you keep your boat in an area that experiences seasonal sailing. Exclusions from the calendar could be related to location and weather.
Acts of war and terrorism: Taking your boat into a war zone or high-risk area is usually not covered.
Keep in mind certain exclusions outweigh others, meaning your boat may sink and yet meet some standards, but not all, meaning you might still be covered.
Types of Boat Insurance
Liability Insurance: This protects the boat owner against harm done to other vessels or injuries to people by the owner’s boat. Since it excludes the protection of your own boat, it is the least expensive type of insurance. If your boat sinks or is damaged, you will receive nothing; it is merely insurance to cover any damages you may cause to others.
Hull Insurance: This policy will reimburse you if your vessel is lost. For smaller, older boats, obtaining hull insurance may be challenging or impossible, as well as unreasonably expensive.
Salvage and Recovery Post Sinking
Each foot of boat length can cost hundreds of dollars in salvage, refloating, and towing. The “lifting, removal, or destruction of a watercraft’s wreckage” is often covered by liability insurance. Additionally, it might pay for the costs of cleaning up an oil or gasoline spill.
Contact Us at Reardon Agency to Get the Best Boat Insurance Coverage Plans
You should ensure you have adequate boat insurance coverage to protect yourself and your boat in the event of an unfortunate accident. For this, you need an experienced team of agents. Contact the team at The Reardon Agency today to get started on your customized coverage!
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