Insurance agencies that deal with clients that own watercraft understand that there are unique risks and exposures associated with businesses that engage in boat sales and rentals. Boat insurance coverage is specifically designed to protect your clients from many different types of losses associated with the boating industry. There are certain types of coverage to discuss with clients looking for recreational marine insurance for their yachts, boats and various seaworthy vessels. The types of policies they should be made aware of include:
- All riskA fairly comprehensive policy, all risk is necessary to cover any loss (except anything listed as a specific exclusion on the policy). Exclusions generally include such things as normal wear and tear, damage caused by animals or any design defects.
- LiabilityYou should advise customers that carrying liability coverage, usually referred to as protection and indemnity, is easily the wisest decision they can make. For example, explain to them that, if while boating they accidentally cause damage to another vessel, this policy provides protection by covering potential legal fees, wreck removal services or salvaging costs, and even environmental charges if the resulting damage pollutes the water.Your recreational boating clients will also want to be protected in the event a guest on their boat is injured or perhaps even killed. Other concerns naturally include any physical damage that their craft might experience and any items permanently attached to the vessel, such as anchors.
- Theft and other vital concernsConsult with them about coverage against other potential issues, such as theft and other issues often out of their control. Go over other coverage options they may be unaware of, like coverage that protects against break-ins resulting in acts of vandalism and natural disasters, such as fire or floodwaters.
- Agreed value versus actual cash valueLet clients know they have a choice in recreational marine insurance; insuring for Agreed Value (sometimes called Stated Value), which is basically replacement cost insurance. If their boat ends up so extensively damaged that it’s considered a total loss, this option would let them replace their boat with another of similar quality.By opting for Actual Cash Value (ACV) coverage, the boat becomes a write-off and they would only receive the amount for which the vessel is valued at the time. This may often end up far less than the replacement cost due to depreciation.