Operating a boat means a lot of fun, but it also means a lot of risk. Should an accident strike the vessel, the damage could be severe. Certain accidents may completely destroy the boat, leading to hull loss.
If you lose your boat, you might want to replace it. Boat insurance policies cover replacement differently. Boat owners should make sure they have adequate coverage to cover some or all of the replacement.
Standard Boat Insurance for Hull Loss
Should you need to replace your vessel, boat insurance can serve as a vital asset to you. It can help you access the funds to replace the boat without having to dip into your own savings.
More than one hazard could cause a loss of the vessel. An individual boat policy can usually cover the vessel from a variety of standpoints. Policies usually divide the different hazards into different coverage designations.
- Collision Coverage: An accident or collision could totally damage the boat. Collision coverage will usually cover the replacement or repair of the hull.
- Comprehensive Coverage: Comprehensive insurance often covers hull losses that stem from hazards other than collisions. These may include fires, theft or other damages.
It’s imperative that boaters verify that their policy covers them wherever they use the boat. Ideally, a policy should cover the boat both in and out of the water. It should also cover boaters on the specific body of water on which they intend to sail.
Varying Types of Hull Replacement Coverage
When you lose your boat, you will likely want to replace the vessel. Each policy may cover such scenarios differently.
- Replacement coverage: Pays the full cost to replace the boat or make total repairs
- Agreed-amount coverage: Pays a pre-determined amount for the replacement of the boat. If the boat insurer and the boater agree on a price of $25,000 for the boat, then that is the coverage maximum.
- Market value coverage: A boat’s value depreciates over time. Your boat may have been worth $100,000 five years ago, but is now worth $50,000. If replacement coverage comes at market value, you may only receive the boat’s current value in compensation. This may not be enough money for you to replace the vessel.
If you can afford repairs, then agreed-amount or market value coverage may work. But, if you cannot afford repairs, consider replacement value coverage. While this determination may impact your policy price, you could face more financial hardship without the right coverage.
Call All About Insurance at one of our three locations - Mid-Cities at 817-589-0006, Fort Worth at 817-626-3339 or our Mansfield/Arlington office at 817-453-5524 now! We can help you get a fast, free boat insurance quote.