Buying Your First Boat? Your Boat Insurance Questions Answered

For those that enjoy being out on the water in a rented or borrowed boat, the obvious next step is to purchase a boat of your own. But becoming a boat owner does come with additional responsibilities, including learning to operate it safely and perform the maintenance tasks it will require to keep it running. In addition, first-time boat owners will also need to make sure their new toy is properly insured to protect them from loss and liability issues. If you are one of thousands of boating enthusiasts who will become first-time boat owners this year, the following information will answer many of the boat insurance questions you will likely face. 

Is boat insurance really necessary? 

Because most boats are only used a few times each season, purchasing an insurance policy may seem unnecessary at first glance. In reality, covering your boat with a good loss and liability policy makes sense whether you take it out every weekend or it sits in your backyard for months on end. Some states mandate boat insurance, with the actual requirement usually being dependent on the size of the engine or where the boat will be used. 

Even if you live in a state where there is no mandate to cover your boat with insurance, carrying adequate liability coverage is an important protection against financial loss if your boat is involved in an accident. Recent statistics published by the United States Coast Guard (USCG) show how important this is with the following facts: 

  • there were a total of 4,291 boating accidents reported in 2017
  • these resulted in 658 fatalities and 2,629 injuries 
  • the amount of  property damage due to these reported boating accidents was approximately $46 million dollars 

When purchased along with coverage for medical care, theft, damage, and loss, boat insurance is a low-cost way of protecting the investment you have in your boat as well as helping to prevent devastating financial losses in the event of a tragic accident on the water.

Does your car insurance cover your boat when it is being towed? 

The answer to this question depends on the actual policy and situation involved. While your car's liability coverage may provide some limited coverage for your boat while it is hooked onto your car, it will only be a nominal amount.

Some insurers specify that the boat and the trailer it is riding on must also be specifically listed on your car's insurance policy in order to have any coverage at all. Purchasing boat insurance that provides full-time coverage for the boat is the best way to ensure that you are protected when pulling your boat to and from the water, when it is in use, and when it is parked, docked, or stored. 

Is there any way to reduce the cost of boat insurance coverage?

Most auto insurers offer discounted rates for drivers who complete driver safety courses, and the same is true for most boat insurers. Coast Guard–approved safe boating courses are offered across the nation by recreational groups and public safety departments, as well as local Coast Guard stations.

Successfully receiving certification from one of these approved courses can often help reduce premiums for boat insurance. In addition, your boating record, credit score, driving record, and other risk factors might be assessed by boat insurers when someone applies for boat insurance. Negative information in any of these areas, including operating a boat or vehicle under the influence of alcohol or drugs, speeding tickets, or negative credit reporting information, can all raise the cost of boat insurance premiums. 

Boat insurance is an important part of being a responsible boat owner, but getting the best coverage and rates is important, too. Before finalizing the purchase of your boat, take time to discuss it with a reputable boat insurance broker in your area. Doing this will allow the broker to help you understand the coverage you need and how to obtain it at the best possible price.