Insurance Coverage

[PmacOC]

I'm new to this forum and glad to be here. I see we have a sponsor who sells boat insurance and I'll call Vito straight away, but I'd like some help in determining the best comprehensive coverage to get. Last summer a stainless steel plug on the top of the engine of my 2003 SeaRay failed and as a result a constant stream of water shot out of a hole in the plug and into the intake manifold ruining the engine. Both my marina and my Progressive insurance adjuster said they had never seen a stainless steel plug like this fail, but Progressive denied my claim. When I read my policy, the comprehensive section covers almost nothing. My boat was meticulously maintained and this bad part resulted in a catastrophic engine loss. Something like this should have been covered, but it wasn't. Does anyone know of how I should make sure my next policy protects me more fully? Thanks in advance for your help.

[Capt. Debbie]

First off get a REAL marine insurer. Home owner policies are cheap and convenient but don't cover real marine events and boat eventualities. Your boat sinks they write a check to face value for loss and walk away. But who pays for the salvage and the disposal? YOU DO.

Real Marine insurers covers salvage, recovery, oil fuel spills/leaks & Fines if it sinks, and obviously the same liability for personal injury and vessel loss coverage. A friend of mine lost a $15000 boat and was socked with $9000 in recovery costs.... the home owner insurance check was $15000. Disposal costs were another $3000.

But even real Marine insurers do not cover everything and every kind of run of the mill disaster. In my own policy on a real marine insurer in "fine print":

1- Nov 1 thru May 1 there is NO in water coverage it remains suspended unless I get a special "in water" off season rider.
2- My insurance coverage is totally suspended if I enter Florida waters.

Little things, but catastrophically bad if you don't know and do it assuming all is the same.

[PmacOC]

Thanks Capt., will do.

[Gerry Zagorski]

Don't want to burst your bubble but boat policies do not cover damage to an engine or drive unless it's due to a sinking, accident or hitting something... Let's face it, boats break all the time and unless you purchase an extended warranty on the motors or drive, they are not going to cover it.

Think about your car.... You blow a radiator house, engine overheats and you blow a head gasket.... Your car insurance is not going to cover that but it you had an extended drive train warranty the company you paid for that warranty probably would.

If I were you, I would call Vito and see if he deals with any boat insurance companies that provide the type of insurance you are looking for... If the answer is no, if you want to pay some money to get your engine insured, there are after market companies out there where you can purchase extended warranties for engines and drives.

Hope that helps.

[PmacOC]

Thanks Gary and have no fear about busting the bubble. A brand new motor did a complete job of that. It was just disappointing that a plug that should never fail caused such an expensive result. I realize you're correct, no insurance company takes on that kind of risk.

[shrimpman steve]

Maintenance is not insurance. And insurance does not cover wear and tear.

Call Vito.

[Capt. Debbie]

Insurance companies also have escape(make no payment) clauses.

We salvaged a boat that sunk in its slip in the Highlands when it got stuck under a fixed dock in a rising tide. We crank and pump and refloat while the insurance examiner watched on. Insurance guys shoots pictures.

Insurance guy is staring at the stern of it and the 90hp O/B motor like he's going to rape the boat. He steps on board and is shooting more pictures, cabin, helm, transom and several of the side of the O/B smiling.

He asks owner if that truly is a 90hp on the transom or just some decal change on the cowl.

Owner confirms that it is a two year old 90hp. Insurance examiner makes note of that, asked the price, where he bought it from. Gets that info. Has owner sign off on the description given.

Then he tells owner the max Hp for the boat on the Capacity Plate is only 75hp. He tells the owner, the overpowering voids ALL his coverage since he did not get a Rider for non-standard and over powered vessel. And that his loss and the recover costs are not covered, because of the oversized O/B is not the boat they were told of and insured.

He can appeal it but his is unlikely to get a dime for the sinking.

A REAL WAKE UP CALL FOR EVERYONE.

[briansnat]

Insurance companies also have escape(make no payment) clauses.

We salvaged a boat that sunk in its slip in the Highlands when it got stuck under a fixed dock in a rising tide. We crank and pump and refloat while the insurance examiner watched on. Insurance guys shoots pictures.

Insurance guy is staring at the stern of it and the 90hp O/B motor like he's going to rape the boat. He steps on board and is shooting more pictures, cabin, helm, transom and several of the side of the O/B smiling.

He asks owner if that truly is a 90hp on the transom or just some decal change on the cowl.

Owner confirms that it is a two year old 90hp. Insurance examiner makes note of that, asked the price, where he bought it from. Gets that info. Has owner sign off on the description given.

Then he tells owner the max Hp for the boat on the Capacity Plate is only 75hp. He tells the owner, the overpowering voids ALL his coverage since he did not get a Rider for non-standard and over powered vessel. And that his loss and the recover costs are not covered, because of the oversized O/B is not the boat they were told of and insured.

He can appeal it but his is unlikely to get a dime for the sinking.

A REAL WAKE UP CALL FOR EVERYONE.

That's not encouraging. I was looking for insurance for my little 14 ft boat with a 9.9 motor. All was going fine, the price was right, but when I told them the boat was built in 1984 I was told they do not insure boats over 25 years old.

I thought about going to a marine specific insurer, but the wood transom had been replaced and there is no longer a capacity/HP sticker on it. Now I'm wondering if I insured the boat whether there would be some fine print clause about the boat being "modified" and ineligible for any claim.

[shrimpman steve]

Quick lesson most may know some may not:

Two types of insurance.

1. Liability. I reccomend this for ANY boat owner as this protects you from lawsuits if anyone gets hurt on your boat as well as if you hurt anyone with the vessel. It's a must. You don't want to loose your house due to an unfortunate accident.

2. Propert coverage. This covers your personal property (boat, motor, personal property). This coverage is more of an option (unless you have a loan on the vessel, if that's the case the lender may require you carry this coverage).

If you have an umbrella policy you want to make sure you carry enough liability to satisfy any underlying limit requirements. Once again, God forbid there is an accident, you WILL be sued. Don't loose your home over it!!!!!

[Capt. Debbie]

Marine insurance has a few more items as mentioned above.

The homeowner's umbrella policy DO NOT. Items like recovery, disposal costs, oil spill costs are NOT SEPARATE COVERAGE and CHECKS and they simply pay boat value and walk away. Besides losing your boat you have a great BIG bill they do NOT cover after boat is paid.

If the boat sinks you have NO IDEA how under covered you are with a home owners' umbrella coverage added.

LESSON LEARNED
That umbrella coverage pays you value of boat ONLY for a total loss like a sinking. That's it.
All the other stuff recovery/salvage , fines, disposal costs YOU PAY FOR. Which in many cases will be close to value to the older boat. In the end your $13,000 umbrella coverage leaves you close to $0 or writing a check if there's a salvage. Be VERY AWARE of this lack of coverage.

MORAL OF THE STORY
Home owners coverage is NOWHERE NEAR a true marine insurer's coverage. Bad time to learn is after your sink. That your cheap policy is cheaper for a very good reason YOU will be paying for now





Quick lesson most may know some maynot:



Two types of insurance.

1. Liability. I reccomend this for ANY boat owner as this protects you from lawsuits if anyone gets hurt on your boat as well as if you hurt anyone with the vessel. It's a must. You don't want to loose your house due to an unfortunate accident.

2. Propert coverage. This covers your personal property (boat, motor, personal property). This coverage is more of an option (unless you have a loan on the vessel, if that's the case the lender may require you carry this coverage).

If you have an umbrella policy you want to make sure you carry enough liability to satisfy any underlying limit requirements. Once again, God forbid there is an accident, you WILL be sued. Don't loose your home over it!!!!!

[broken bobber]

JUST CALL VITO....

He is a REAL insurance guy and will answer all and any questions........:)

[Capt. Debbie]

Exactly and walk through the questions of what is covered... liability, vessel loss, recovery costs, environmental assessment, vessel disposal. There should be coverage for each SEPARATELY. Not just a single check for vessel loss and leave you hanging for all the rest of the bills.

This happened to a friend from Sandy destruction on a home owner policy. I teach it in my classes too. Knowing the difference in coverage is important.



JUST CALL VITO....

He is a REAL insurance guy and will answer all and any questions........:)

[Charlie B]

Good advice...Charlie

[shrimpman steve]

Bobber and company, no offense, I am a real insurance broker. Been licensed for 30 years.

The umbrella policy I mentioned is strictly a liability function which I previously stated. That is to protect you from lawsuits.

Property losses if you loose your boat are another coverage. I agree call Vito. He is a sponser and as a licensed insurance broker I have him writing my coverage.

There is no question you should have marine insurance. The umbrella kicks in if someone sues you and your LIABILITY Limits are not sufficient. In other words if you are sued for 1,000,000 and only have $300,000 in liability on your marine liability the umbrella should pick up the difference. If you own a home, or other assets, you should carry a $1,000,000 umbrella policy, period. That is the purpose of an umbrella policy. It has nothing to do with you recovering money on your physical loss. It is to protect your assets.

Thus endith the lesson.

[shrimpman steve]

Marine insurance has a few more items as mentioned above.

The homeowner's umbrella policy DO NOT. Items like recovery, disposal costs, oil spill costs are NOT SEPARATE COVERAGE and CHECKS and they simply pay boat value and walk away. Besides losing your boat you have a great BIG bill they do NOT cover after boat is paid.

If the boat sinks you have NO IDEA how under covered you are with a home owners' umbrella coverage added.

LESSON LEARNED
That umbrella coverage pays you value of boat ONLY for a total loss like a sinking. That's it.
All the other stuff recovery/salvage , fines, disposal costs YOU PAY FOR. Which in many cases will be close to value to the older boat. In the end your $13,000 umbrella coverage leaves you close to $0 or writing a check if there's a salvage. Be VERY AWARE of this lack of coverage.

MORAL OF THE STORY
Home owners coverage is NOWHERE NEAR a true marine insurer's coverage. Bad time to learn is after your sink. That your cheap policy is cheaper for a very good reason YOU will be paying for now

Frank, you are wrong and should not be teaching people about insurance (I say this respectfully) the umbrella policy pays YOU NOTHING. The umbrella pays the people that sue you as well as your defense costs in court if you kill or injure someone. Umbrella coverage has NOTHING to do with what YOU collect on a loss to your vessel. There is no question that a boat owner should have a separate marine policy but that policy may only have 500,000 in liability. The umbrella policy SITS OVER the underlying liability policy. Your understanding of an unbrella policy is incorrect and any homeowner should make sure there is enough liability coverage so you don't loose your home should someone sue you. A lawsuit over a death is gonna cost you more then loosing your boat!

[shrimpman steve]

This happened to a friend from Sandy destruction on a home owner policy. I teach it in my classes too. Knowing the difference in coverage is important.

Not to beat a dead horse but number one unless you have an insurance brokers license you should not be teaching coverage. You are doing your students a disservice as you do not understand the purpose of an umbrella policy. Or the differece between 1st and 3rd party coverage. If you want to PM me I can explain what the differences are. I don't mean to call you out, but feel my knowledge gained over 30 years was disputed. I really would have no problem discussing the merits of different coverages with you so you can impart the information to your students.

Really no disrespect intended

[MM Insure]

Thanks for the recommendations gys, appreciate it. If anyone on the site has any questions regarding boat insurance, or would like to have their policy reviewed, feel free to give me a call. Our office number is (848)863-6800 X 10

Similar to Steve, I have also been an independent insurance agent for 30 years. Nothing beats the advice of a knowledgeable independent insurance agent.

Merry Christmas!

Vito

[Capt. Debbie]

Well I am also an Attorney who represented a Sandy victim in a lawsuit with C&C Marina in Bayville. And this is exactly what happened on his homeowners policy. Paid for lost boat cost. The recovery, salvage, and disposal is NOT COVERED. They pay policy limit once.

Perhaps you need a little tutoring? And learning about marine insurance is a good thing. This is a good dialogue.

Umbrella insurance has a flat coverage. That is the total and ALL They will pay out if boat is totaled is the boat loss- NOTHING ELSE. The liability portion of you homeowners policy IS a different section- yes,

And you can buy as much liability coverage as you want. It may have $500k or $5M. That simply what you picked and paid for.


Frank, you are wrong and should not be teaching people about insurance (I say this respectfully) the umbrella policy pays YOU NOTHING. The umbrella pays the people that sue you as well as your defense costs in court if you kill or injure someone. Umbrella coverage has NOTHING to do with what YOU collect on a loss to your vessel. There is no question that a boat owner should have a separate marine policy but that policy may only have 500,000 in liability. The umbrella policy SITS OVER the underlying liability policy. Your understanding of an unbrella policy is incorrect and any homeowner should make sure there is enough liability coverage so you don't loose your home should someone sue you. A lawsuit over a death is gonna cost you more then loosing your boat!

[Capt. Debbie]

I think this is a great string.

Many find out too late their insurance coverage does NOT cover all they need with a boat.

Whether true marine insurance and homeowner policy's umbrella and boat rider coverage are VERY VERY DIFFERENT.

While liability coverage is a number you choose and pay for. The rest is staggering in differences.

Let's not forget boat insurance is optional.

It's a bad time to find out the difference when you looking at your destroyed sunken boat and the vessel recovery costs (about $100-200 per foot) are equal to the boat's value and your replacement check is being used to pay for recovery and if anything is eve left the disposal of the hulk.

Depending on age of boat you may not have anything left.

[shrimpman steve]

Frank
I agree good dialogue.

The umbrella policy is a separate policy. Not part of the homeowners. Some carriers will not write more then 500,000 or 1,000,000 in liability. This is where the umbrella policy comes in. Let's face it, we live in a litigious society and people sue for as much as they can. All the unbrella does is increase the "base" limit on the liability end. I recommend anybody who owns a car and a house carry as much liability as you can reasonably afford. The last thing you should be doing is driving around with minimum liability limits. God forbid you kill a family in an auto or boating accident, I guarantee you can't have enough liability coverage.

As far as the many exposures faced by boat owners, no question you are better off with a marine policy to bring you back to whole after a sinking or other incident.

Hopefully between the two of us we have opened peoples eyes as to the importance of insurance

Merry Christmas
Happy Chanukah
And a healthy new year!

[Charlie B]

Yes, sure did open my eyes...Charlie