Category Archives: boating safety

Most common boat claims

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Owning a boat has its risks. 
In general, the biggest risk comes to the bank account.  At least that’s in my personal experience, owning a boat always seems to costs me money.  Of course, so does a Harley, Cessna or anything else I own. There is always a never-ending list of improvements and gadgets that I want to add.  And if I don’t add things to the existing boat, there is always another boat around the corner I want to buy. New or used the “risk” is there. 
So think you can save money by not adding anything new to your boat?  Sorry doesn’t work that way.  Even if you don’t add or change things on your boat, there will always be regular maintenance items that are the result of age or wear and tear. There are also a few fixed costs that boat owners cannot get away from.  Slip or mooring fees and insurance are just a couple. No one but the owner pays these types of expenses.  They are part of the risk of owning a boat. 

Maintenance is necessary and vitally important to maintaining the value and safety of the boat. It is also something that can’t be covered by warranties or insurance. There are a few things that are covered under the warranty that may be construed as maintenance, but typically, warranties are good for defective manufacturing or assembly of your boat, motor and accessories.  If it is a problem that results from regular use (wear and tear) or recommended service intervals…it is not going to be covered by a warranty.  Sure there is always that chance that the local dealer might include free oil changes or tune-ups for some limited amount of time. But that’s not a typical warranty.

Time to make a shameless plug and tell you to buy my book, “Ultimate Boat Maintenance Projects”. Published by Motorbooks International and available at book stores or directly from SkySmith. Okay, good maintenance wont protect you from everything, but it sure will help.  I also think that doing some of your own maintenance will make you feel more comfortable as an owner. Learn how and do basic maintenance as an owner,m its good for you!  Want to know more, go to one of my seminars at a boat show in your area.  Not speaking at your boat show?  Maybe you should get them to invite me! Okay, off the soap box. 
Anyway…Insurance, (often defined as the transfer of the risk of a potential loss, from one entity to another, in exchange for a reasonable fee) is sometimes expected to pay for these regular expenses.  Well, let me remind you that wear and tear and maintenance are not covered by insurance. 
Many people try to have regular maintenance items covered by insurance only to be disappointed when the claim is denied.   Items like frozen and cracked engine blocks, overheating damage, even the failure of the bellows will not be covered. The cause (poor service, lack of antifreeze, etc) won’t be covered but the resulting sinking or fire may be. That’s the key. Let me try and clarify this again, the accident and the resulting damage should be covered, but the cause might not.  An example could be the deteriorating bellows on a lower unit.  If the bellows dries out and cracks it could leak and the boat could sink.  The bellows would not be covered, but the damage that results from the sinking probably would.   Okay, seems pretty gray, which but that is just the way it is.
So what are some of the most common claims?
There are a few claims that keep popping up.  One marine insurance claim department I contacted felt that about 80 percent of their claims are the result of hitting a submerged object.
Think about it.  The more storms there are, the more rivers that flood, the more stuff is floating in the water and under the surface. Submerged objects will result in damage to lower units, propellers, keels, and hulls.  Sometimes sinking does occur. If you think or know you hit something, make sure you check bilge area and monitor the bilge regularly to make sure there is not any damage that could result in submersion or, in other words…sinking.
Using information from marine insurance claim departments and organizations like Boat US, a few of the other common claims I discovered are:
Theft of assorted boat equipment and parts (portable or permanent).  Items like out drives, electronics, outboard motors, and trailers are some of the most popular parts.  Leaving the trailer unattended in the parking lot or the cockpit uncovered is an invitation for a thief.  Check your policy, many do not cover items stolen from your boat unless it was permanently attached or in a locked compartment. 
Grand theft boat.  Snatching the whole boat is another big claim.  While there are cases of theft from a slip or mooring, trailer-based boats are the ones that are usually turned in on a claim. Boats, like cars, are often stripped and the parts sold a piece at a time.  Remember the phrase “the sum of the parts is worth more than whole” well that’s true with boat parts.  Plus if you take all the parts off the boat, the parts are harder to track down. 
Collision claims.  Collisions with anything are bad.  Collisions with pilings, docks, and other boats can be deadly.  Collisions are not the same as hitting submerged items. Collisions are just that, colliding with something else either moving (another boat) or stationary (like a dock).  You can help stop collisions by watching where you are going, learn the rules of the area and use your charts.
Grounding or running aground.  Most claims departments indicate that often more damage is caused by trying to accelerate through the sand, mud or rocks than by just stopping and waiting for help.  Using a tow service or an alternative method to get unstuck like air bags, reduces the risk for further damage. . 
Now is a good time to repeat – carry up-to-date marine charts and plan your cruising routes to avoid accidental grounding.
A few of the less common but still important claims mentioned are:
Lightning strikes. Being the one of the tallest things on the water during storms is bound to result in a lightning strike.  Lightning usually “fries” the electronics, puts holes in fiberglass and starts fires.  It is a hard thing to prevent.  Best way to reduce the damage is to ground the boat so the current has a way to pass through to the ground.
Damage from docks.  Wind, weather, and hurricanes, can cause chafing, damage to rub rails and hull joints and even rip cleats out of the decks.  Get in a habit of moving the boat to a safe harbor or new neighborhood when bad weather is imminent.  Learn to tie up securely, use high quality dock lines and fenders.  Last year was bad for the hurricane states.  The underwriters are already increasing rates and reducing or eliminating territories and coverage’s. 
There are a few claims relating to fire and explosion. Often the cause is from bad wiring, fuels leaks, overheated manifolds, and even bilge vents not being used or being blocked. These claims can be reduced or eliminated just by taking part in a good preventative maintenance plan.
Occasionally there will be a boat that sinks from bad through-hull fittings, damaged sea cocks and the bilge pump being blocked and/or the back up bilge pump and warning system being inoperative.  Occasionally a storm with lots of heavy rain or combined with a lightning strike can short the boats battery preventing the bilge pumps from working.
Of course, the list above is not inclusive.  There are all sorts of variations along with different levels of each type of claim.  Even if you take all the precautions, accidents do happen. Boat owners buy insurance to transfer the risk to the insurance company for those unexpected catastrophes, so make sure you have the right coverage for your vessel and you implement a preventative maintenance plan to help reduce potential claims.  

Boat Insurance Basics.

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Boat show season is upon us.  Shopping, drooling and deal making are at a feverishly pitch pace during a boat show.  And like many people, it’s a time that I forget the basics and make decisions based on emotion. If you are a boat show buyer in the colder regions of the country where visions of wake jumping are still in your head, you are at a greater risk for emotional buying.  Snow and ice create an urge to be boating that sometimes influences your purchase plans.  Don’t let the dismal weather outside put you at a disadvantage inside the boat show. 
One major expense that most people leave to the last is insurance.  Talking about insurance can be boring, but it is a necessity.  Sure you can call the agent that insures your car if you want limited coverage for your boat. But you should really start your insurance search with a marine insurance specialist, especially when you start operating bigger and more expensive boats. A dedicated marine policy will have special coverage for boats such as stated or agreed values, coastal territories and extras coverage that an auto or homeowner’s policy just can’t provide.  
So before you make a decision about your fun on the water, let’s review a few insurance topics that can affect your new purchase.
Marine underwriters look at a number of factors when they figure insurance premiums.  These factors include the size of the boat, the location of the boat during storage and use, extra equipment, and the experience of the boat owner/operator.  If you are new to boating, you will probably want to stay below 26 feet for your first purchase. The 26-foot market is significant not only for coast guard safety requirements but also from an underwriter position on experience and the covered territories.  Most marine insurance companies will cover a 26-foot boat up to 50 miles from the coast and will provide insurance for new owners without any special requirements. 
If you are based on the coast, the bigger the boat the further from shore you can travel.  The bigger the boat, the more stringent the experience and training requirements become. For example, you may not be able to get insurance as a new owner on a 40-foot boat if you have never owned a boat in the 30-foot range.  There may be requirements to obtain additional training or to hire a professional captain to operate the boat with you for the first year.  Oh, and then there are the survey requirements.  Many of the smaller boats will not require a survey before the underwriter will start coverage, but if it’s over 26 foot, almost always, unless it is brand new, a survey (and usually out of water) will be required prior to coverage being started.  
Look for a marine insurance policy that has an insured value of the vessel based on an “Agreed Value” compared to a policy that uses “Actual Cash Value”.  With Agreed Value coverage, the boat owner will be paid the insured value of the boat (minus a deductible) in the event of a total loss.  The insurance company will not depreciate the value of the boat at the time of the loss.
Whereas in the event of a total loss with “Actual Cash Value” coverage, the boat owner will receive the insured value of the boat or the actual cash value (depreciated value), whichever is less.  For example, if you have your boat insured for $75,000 and have a total loss, the depreciated value of your boat may only be $65,000 and the insurance company will pay the lesser amount.

A few other items to look for are:
Separate Watercraft Liability coverage.  Don’t rely on liability coverage that is an extension of the liability coverage on your homeowner’s or auto policy.  You want liability coverage forbodily injury and property damage that you (the insured) are found liable for when operating your boat.
Medical Payment coverage for the insured and any friends or family who get injured while they are on board the boat, boarding the boat, or departing from the boat.
A couple of optional coverage’s that are nice to have include:
Uninsured Boater coverage.  Uninsured Boater Coverage will pay for damages sustained from the actions of an uninsured boater.  There are a few variations of what is covered, typically it covers bodily injury, but sometimes it can also cover property damage. 
Towing Coverage applies to any service charge the insured may incur by receiving marine assistance.  This may include coverage for a service charge for towing due to engine failure, mechanical breakdown, grounding and delivery of fuel.
Personal Property Coverage is for clothing, personal effects, fishing gear and sports equipment owned by you, your family or guests on board your boat.  Money, jewelry, traveler’s checks and other valuable papers or documents are not included for this coverage.
This is just a brief highlight of marine specific insurance; there is a lot more information that needs to be discussed in a marine policy.  Each company has different definitions and limits on their coverage.  Contact a qualified marine agent to explain the coverage’s in more detail. And remember, even if you take all the precautions, accidents still happen. Make sure you can get or have the right coverage for your boat before you buy.  

Additional tips:

  • Get out there and boat.  Experience moves you up the boat ladder and helps your insurance rates and requirements. 
  • Plan on getting a survey whether the insurance requires it or not, it is just a good practice. Plus it helps determine a value for the boat.
  • Participate in training programs Coast Guard or others.
  • Regular maintenance can help reduce the cost of ownership and risk of problems.  Inspect or have your boat inspected by a qualified marine mechanic at least a couple of times a year. 
  • Fix things that are broken or in need of repair before someone gets hurt or you get stuck on the water and you have to make a claim.  Claims will affect your rates and ability to get insurance.
  • Have a plan to protect or move your boat if bad weather is heading your direction.  If bad weather is winter, lay up the boat. Most underwriters offer reduce rates for boats that are not used year round.
  • Securely store your boat by installing theft prevention devices on electronics, outboard engines, out drives, trailer hitches, etc. 
  • Install alarm and safety systems to protect against high bilge water levels, fires, vapors and theft.
  • Keep your supply of charts and data cards current and plan your routes to avoid accidental grounding and bad weather.
  • Be a responsible boater and use appropriate Personal Flotation Devices; don’t drink and boat and follow the “rules” of the waterway.

What are the most common boat claims ?

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There are a few claims that keep popping up.  One marine insurance claim department I contacted felt that about 80 percent of their claims are the result of hitting a submerged object.

Think about it.  The more storms there are, the more rivers that flood, the more stuff is floating in the water and under the surface. Submerged objects will result in damage to lower units, propellers, keels, and hulls.  Sometimes sinking does occur. If you think or know you hit something, make sure you check bilge area and monitor the bilge regularly to make sure there is not any damage that could result in submersion or, in other words…sinking.

Using information from marine insurance claim departments and organizations like Boat US, a few of the other common claims I discovered are:

Theft of assorted boat equipment and parts (portable or permanent).  Items like out drives, electronics, outboard motors, and trailers are some of the most popular parts.  Leaving the trailer unattended in the parking lot or the cockpit uncovered is an invitation for a thief.  Check your policy, many do not cover items stolen from your boat unless it was permanently attached or in a locked compartment. 

Grand theft boat.  Snatching the whole boat is another big claim.  While there are cases of theft from a slip or mooring, trailer-based boats are the ones that are usually turned in on a claim. Boats, like cars, are often stripped and the parts sold a piece at a time.  Remember the phrase “the sum of the parts is worth more than whole” well that’s true with boat parts.  Plus if you take all the parts off the boat, the parts are harder to track down. 

Collision claims.  Collisions with anything are bad.  Collisions with pilings, docks, and other boats can be deadly.  Collisions are not the same as hitting submerged items. Collisions are just that, colliding with something else either moving (another boat) or stationary (like a dock).  You can help stop collisions by watching where you are going, learn the rules of the area and use your charts.

Grounding or running aground.  Most claims departments indicate that often more damage is caused by trying to accelerate through the sand, mud or rocks than by just stopping and waiting for help.  Using a tow service or an alternative method to get unstuck like air bags, reduces the risk for further damage. . 

Now is a good time to repeat – carry up-to-date marine charts and plan your cruising routes to avoid accidental grounding.