Boat Liability Insurance

[Rockfish]

My boat insurance renewal is coming up. It will cost me $130.00 per year to go from 2 million liability to 4 million. Interesting if i were to go to 3 million it would be almost $100.00 more so 4 million is a bigger bang for the buck. I am curious how much people are carrying for liability insurance and thoughts on the subject. Mine is a medium size sport boat and I never fish alone for safety so there is usually 2 or 3 on board. It is rare for us to go above that and I do not guide.
It is not just collision damage and injury or death issues but also things like recovery costs and environmental damage and clean up costs if it sinks at the dock and has a major fuel leak, or has a fire in its marina slip and causes fire damage to the marina or other boats. I see that a 40 ft cruiser just burned up at the Oak Bay Marina which got me thinking about Liability. So far over many years I have never made a boat insurance claim.

 

[terrin]

My boat insurance renewal is coming up. It will cost me $130.00 to go from 2 million liability to 4 million. Interesting if i were to go to 3 million it would be almost $100.00 more so 4 million is a bigger bang for the buck. I am curious how much people are carrying for liability insurance and thoughts on the subject. Mine is a medium size sport boat and I never fish alone for safety so there is usually 2 or 3 on board. It is rare for us to go above that and I do not guide.
It is not just collision damage and injury or death issues but also things like recovery costs and environmental damage and clean up costs if it sinks at the dock and has a major fuel leak, or has a fire in its marina slip and causes fire damage to the marina or other boats. I see that a 40 ft cruiser just burned up at the Oak Bay Marina which got me thinking about Liability. So far over many years I have never made a boat insurance claim.

With house insurance you only worry about damage on your own property if your tree falls over and bashes in your neighbors roof the claim goes to their insurance not yours so not sure if that same principal would not apply in a marina fire situation.

 

[uclueletcharters]

I would assume the marina has insurance for loss but double check, seems to me they usually want 2 million liability coverage in a commercial app. I think you would only need replacement coverage for your own hull in the event of. There's a maritime law of the sea which is much different than on land where there is a max claim amount of I believe around 365K per person in which case multiply the max amount by number of guests on your boat and that's your liability number. Your insurer should be able to explain all those details and a call in to your Marina should be able to shed light on what their coverage is in the event your boat caught on fire and caused damage to their facilities and adjacent boats.

 

[wolf]

Under the Canadian shipping act . when we took the courses whoever could only sue for 1 million and that was it so if 5 people sued you it will be split by that, correct me if im wrong but thats what I do remember as we went over that quite a bit....

 

[dmurph]

I can’t fully answer your question, but I lust reinsured my boat this week and the broker said rates were going up in the new year

 

[Derby]

lol.. they went up in 2019 in some cases by 25 percent or more...just because .....

 

[uclueletcharters]

Just like house and auto, the workin stiff gets screwed some more.

 

[Bill 310]

Ask your broker if you can purchase an umbrella policy. These policies provide an over arching liability umbrella over your home, vehicles etc.
We are without a boat at the moment so I hadn't thought about covering a boat under ours.
We don't buy extra liability under ICBC for example, just the minimum, because the umbrella policy coverage is far more comprehensive and overall less expensive.

If you have a good general insurance agent they can explain this to you.
The kiosk type general agents i.e. drug stores, supermarkets, are often unaware of these policies or unable to sell them.

 

[uclueletcharters]

Bill 310 Thanks for sharing will look into that.

 

[Rockfish]

Ask your broker if you can purchase an umbrella policy. These policies provide an over arching liability umbrella over your home, vehicles etc.
We are without a boat at the moment so I hadn't thought about covering a boat under ours.
We don't buy extra liability under ICBC for example, just the minimum, because the umbrella policy coverage is far more comprehensive and overall less expensive.

If you have a good general insurance agent they can explain this to you.
The kiosk type general agents i.e. drug stores, supermarkets, are often unaware of these policies or unable to sell them.

There are apparently very few Ins. Companies that offer Condo. Insurance. Last year I asked if I could increase the Condo. liability coverage up from 2 million but was told that 2 million was the most that is offered. They did not mention Umbrella liability policies but I will asked next time I am going over near their office.

Back to boat Ins. I assume most people are carrying the standard 2 million liability on their sport boat.

 

[Bill 310]

There are apparently very few Ins. Companies that offer Condo. Insurance. Last year I asked if I could increase the Condo. liability coverage up from 2 million but was told that 2 million was the most that is offered. They did not mention Umbrella liability policies but I will asked next time I am going over near their office.

Back to boat Ins. I assume most people are carrying the standard 2 million liability on their sport boat.

We have have a umbrella policy on our house, cars and motorcycles. No boats owned during this time period.Boats can be covered.

Here is a link from a leading law firm discussing umbrella policies

http://www.mondaq.com/canada/x/782042/Insurance/Umbrella+Insurance+Policies+Should+You+Have+One

 

[searun]

We are in what is known in the Insurance industry as a "hard market"...here's an article that explains. https://www.canadianunderwriter.ca/insurance/brokers-expect-hard-market-into-2020-1004169173/

Why we are in a hard market is there has been a number of natural disasters and economic conditions that hit the insurance market hard. Most policies you purchase are not fully covered or underwritten by the company you purchase from, they in turn spread their risk by going to the reinsurance market - that market is really driven by world events. So the reinsurance rates are now markedly increasing, which is drying up capital within the Insurance industry. No capital, means no "capacity" to underwrite policies and sell coverage. This is the bigger picture behind the increasing rates.

What we can expect going forward is increasing rates and difficulty placing poorer risks. In other words, if you have a history of filing claims (even a number of small ones), you are a risk that most underwriters will not wish to place coverage for. My Broker's advice is if you have a small claim....don't claim, pay it yourself. Take a higher deductible to save the premium. Also good idea to review your coverage limits, and even get a boat survey to make sure you are not over-insuring the risk. If you can reduce the value insured, that helps manage the premiums you will pay.

In a hard market people who have claims will find it increasingly difficult to shop the market looking for a cheaper rate. In a hard market, its also good to stay with whom you have had a long term business relationship....people who are shopping around catch the interest of underwriters...and in the marine insurance business there are really only 3 main marine underwriters (an underwriter is not a broker). This is getting especially challenging because some of the US underwriters have dumped their Canadian books of business. Some brokers (the good one's who bring underwriters low risk business) will be the one's who will have what is known as "capacity" to actually place or sell insurance policies....so not all brokers are made the same. Smart brokers are the ones who will advise their clients not to make claims for small amounts...keep their loss ratio's down, and clients in the underwriter's good books for a rainy day...like we have now.

Just try getting condo insurance if your strata has made a number of small claims.....some strata's are now getting premiums of $1 million for their renewals and only being covered for 40% of the replacement cost of the building, while others are not even able to find an underwriter who will place the risk. I personally know someone who's monthly strata went up by over $500/month to cover the increase in insurance.

 

[Cuba Libre]

Pat-- what is the scoop on insurance companies requiring a survey on older boats. At one time it seems to be a concern . Is that true now ?

 

[searun]

Having just completed a survey on the advice of my Broker, most insurers in this changing market are looking for a new survey every 5 to 10 years depending on the underwriter's risk tolerance once the boat is older than 10 years. My survey was over 10 years old, so wasn't surprised by the advice. The surveyor told me that he is now seeing some underwriters refusing to look at older boats (as in 1980's). Chances are you won't run into issues if you are sticking with the same underwriter, but it is a big concern in this current insurance market where underwriters are dumping bad risks. One issue I heard from the surveyor is sailboats or old larger boats that are moored year round - they represent a risk of sinking and today the cost of enviro claims is huge, and something the underwriters shy away from now.

In the end, having an updated survey helped my broker press the underwriter for a better rate because we had no claims and a solid survey. In the end I was able to avoid a premium increase saving a little over $300 than what was quoted on renewal. We also just got another refund cheque after the underwriter received the new survey report. So while the survey cost me around $480, it was almost cost neutral in year 1.

 

[Wild Bill]

How much is just liability?

 

[Cuba Libre]

Thanks-- that $480 is a bit of a punch...but amortized I guess its doable.

 

[bryce]

480 is a lot less then I can afford if I disable someone on my boat or someone else’s or face a total loss my boat insurance is a lot more then that but I try to my best to make sure I am covered in a catastrophic incident which I hope none of us ever are

 

[wolf]

Your gonna find even sport fishing boats will be needing a survey to renew its the way the industry is going ...

 

[bryce]

Your gonna find even sport fishing boats will be needing a survey to renew its the way the industry is going ...

My boat is sport fishing only no guiding on it at all and I needed a survey

 

[Confused]

Typically what type,or age of boats require a survey for insurance purposes?