Yacht Insurance - Seven Key Points To Getting The Right Policy
If you have a marine yacht longer than 26 feet in length
, then you are required by law to carry yacht insurance . The proper definition of insurance for yachts under 26 feet is 'boat insurance'. This is to differentiate the insurance for larger yachts which need individually negotiated policies as there are significantly larger values and ranges of requirements involved. That said, both types of insurance do share many common features in general.
What are the key reasons for having a yacht insurance policy in force? . The first reason is to ensure that your financial investment in your valuable yacht is protected in the unfortunate event of the occurrence of damage, fire, theft or any other incident where your yacht is subject to a full or partial loss. The second reason is that yacht insurance provides a financial remedy in case anyone is injured or falls ill while on your yacht or as a result of an accident caused by it.
Which are the key elements you need to examine when insuring your yacht?
Comprehensive Coverage - There are three main areas of insurance for your yacht; physical damage, e.g. collision, fire and vandalism or theft. Some policies allow you to make a selection amongst these. If you chose not to take one or more of these insurance types then you are assuming all the risk in the unfortunate case that such an event occurs. Also that can lead to problems if you have insured for damage, but the actual damage is a combination of collision and fire. So, on reflection, the vast majority of yacht owners sensibly insure against all risks through a comprehensive yacht insurance policy.
Home Mooring - It is important to be open and truthful when obtaining a marine boat insurance quote for your yacht. You may keep your yacht moored in a dock or marina, or it may spend its time in a tidal mooring, but either way you must be honest so you will be properly covered by your boat insurance in the event of an accident.
Liability to Third Parties - If your yacht is damaged or becomes a total write off then you can always just accept your loss. Unfortunately you will not be able to ignore it if another person is injured or their yacht damaged by you or your yacht. You will have to pay up yourself to make restitution. Your yacht insurance policy's third-party liability coverage will prevent you from having to fork over a large amount of money. Even though there is not an overarching requirement for insurance cover there are plenty of localities where it is necessary - an example is in most docks, marinas and harbors where a minimum insurance is required, perhaps $ 2 million.
Location of Coverage - You must be sure to understand where the insurance you have purchased is in effect. The sailing area defined by the majority of yacht insurance companies is pretty generous; however please read the definition carefully and understand what the limits are. If you wish to increase your sailing range then additional premiums may be levied. Location also comes into effect with non-sailing insurance. One example is when the yacht is stored dockside, either over winter or for repairs and maintenance. Another example is if your yacht is to be transported by road.
Insurance Value - There are two main ways by which the total value of your yacht is determined for marine insurance purposes. The first is by an agreed-on figure written into the policy document. The second is by valuation. In the latter case, the value is determined by a marine surveyor after a yacht's loss. Having a pre-agreed figure in your policy brings greater certainty in the event of a claim; a second advantage is that, as the figure is agreed in advance, a settlement can be more speedily executed.
Laid-Up Period - It is a 'feature' of some yacht insurances that you do not sail at certain times of year in some locations to avoid extreme weather and in others to avoid the deep winter months. Check out the policy proposal to ensure you understand any laid-up requirements and that they meet your needs.
Ease of Claim - A yacht insurance policy is only as good as your ability to make claims from it in the event of an incident . Talk to fellow yachtsmen and yachtswomen at your dock, marina or sailing club. Use their experiences to check out the insurance companies and brokers that are best to use, or avoid, so that you will find submitting a claim is easy if it is ever required.
by: Tony Lord
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