Selecting the Right Insurance Policy for Your Boat or PWC

Whether you’re looking for comprehensive coverage or the cheapest boat insurance around, you need to get that watercraft covered.
Essential Boat Insurance Coverage
Some policies will subtract salvage costs from the insured value of the boat. BoatU.S.

You can choose to work with a major company, such as getting Geico boat insurance or Progressive boat insurance, or you can go to a smaller provider. But one thing is for sure: If you have a boat or PWC, you will need insurance coverage. However, just which coverage is best for your needs can be a be a bit confusing. Just like for homes and automobiles, there are many different levels of coverage, terms and types you’ll need to sort through. Are you ready to dive into the details?

Article at a glance:

Comparing Different Boat Insurance Policy Types

When purchasing boat insurance, you’ll generally need to choose between three different types: agreed hull value, actual cash value, and liability only. Unlike automobile insurance, the type of coverage you get isn’t mandated by law in most states (though it is in Arkansas and Utah). Most people decide which plan to opt for depending on the value of the boat, the age of the boat, how it’s financed, and where they keep or use it.

Taking a boating safety course won’t just make you a better skipper. It could also help you save big on insurance.

Safety Tip Provided by the U.S. Coast Guard

Agreed Hull Value

Insurance policies that cover the agreed hull value specify a valuation of the boat, which will be the amount you receive in case of a total loss. This type of policy tends to cover (and cost) more than the others. Smaller insurance companies might not even offer it, while the big players like Geico boat insurance and Progressive boat insurance generally do. These policies often can be purchased with additional forms of coverage, like fuel-spill liability, towing coverage, or roadside assistance for trailer boaters.

Actual Cash Value

Actual cash value policies are the most common and cover your boat for its current market value. Because they take depreciation into account, they’re generally less expensive than agreed hull value policies. Actual cash value policies can usually be purchased with additional forms of coverage too.

Liability Only

The least expensive option is liability-only boat insurance, which only covers things like medical payments arising from accidents or protection from other boaters who are uninsured. Many marinas and boatyards will require you to have liability coverage at the very least.

A VHF marine band radio is your first line of communication on the water, allowing you to talk to the Coast Guard and other boat traffic. Use Channel 16 only for hailing and emergencies.

Safety Tip Provided by the U.S. Coast Guard

Choosing Boat Insurance Coverage Options

Different policies can cover different events, like theft, hurricane haul-outs or salvage assistance. Depending on where you live, these can be more or less important. Someone in Iowa probably doesn’t need hurricane haul-out coverage, for example, while a boater in Florida most certainly does. You’ll also usually need to meet certain coverage requirements if your boat is financed because the lender will want to know they’ll get paid in case of an incident. Some of the most important options to consider include medical payments, uninsured boater coverage and salvage coverage.

Medical Payments

Most comprehensive policies will include some level of medical-payment coverage, which takes care of expenses in case someone aboard gets injured. These are generally capped at a certain level, which varies by policy.

Uninsured Boater

You can do everything right and still have an accident thanks to someone else. If they don’t have insurance, you’ll be glad you have uninsured boater coverage.

Total Salvage

Salvaging a boat can be very expensive, and laws can require owners of stricken vessels to have them salvaged. These policies usually cover salvage expenses up to the hull value of the boat.

How to Purchase Boat Insurance

In most cases, purchasing boat insurance is just a click away because you can get quotes online and compare the different options on the insurance company websites. With larger, more expensive boats, however, having an accredited surveyor inspect the boat might be necessary. This is usually the case when it comes to getting insurance for used boats.

Discounts for Boater Safety Courses

Boater education doesn’t just keep you and your family safe on the water. It can also help you save big on insurance. Providers offer discounts of up to 15 percent on boat insurance for completing a boating safety course. Check with your provider, and find classes through the Coast Guard Auxiliary or U.S. Power Squadron.

A boating course is a great way to gain confidence and boat-handling skills. A little practice now will make it look easy when everyone is watching.

Safety Tip Provided by the U.S. Coast Guard

Closing Remarks & FAQ

Beyond any legal or financing requirements, which insurance you opt for is a personal decision, just as it is with a home or automotive policy. Choose more coverage and spend more on the premiums, or choose less and save on the cost, just as long as the decision lets you sleep well at night.

  1. What are the main types of boat insurance policies?
    Agreed value, actual value and liability only are the three main types of boat insurance policies.
  2. What are some typical boat insurance coverages one should consider?
    The most common are medical payments, uninsured boater, total salvage, towing, hurricane haul-out, fuel-spill liability, theft, roadside assistance and personal-effects coverage.
  3. How does location factor into boat insurance coverage?
    It impacts the need for weather-related coverage, and it can require you to have a documented “storm plan” for taking care of the boat when a named storm approaches. Location can also affect theft coverage, uninsured boater coverage and other protections.
  4. Will boat insurance cover anyone who operates the vessel?
    This depends on the policy. Most will cover other operators and family members who use the boat with your permission, but they won’t cover renting or leasing your boat to someone.
  5. Should boat insurance be bundled with other insurance products?
    It’s up to you, but you can save money by doing so in many cases.
  6. Is it ever wise to operate a boat without any insurance coverage?
    That depends on your personal tolerance for risk. That said, it’s far more worrisome with some boats than others. At one extreme, taking a rowboat out on a lake without insurance is probably fine, but casting off the lines on an uninsured million-dollar yacht would certainly seem dicey.