Going Uninsured !?

[Reckless]

As I tell my clients, Insurance is security. It sucks and is expensive when you don't use it, but the day you need it, it is the best thing you can ever have. You are paying for the peace of mind that you will be ok if something happens.

That being said there are times you should look at the risk and reward, and every individual will have their own tolerances as to what they deem acceptable.

I am currently fully insured and the cost is very low, we just sail the great lakes, I am more concerned with theft and potential damage by others.

The limitations some insurers put on cruisers can be very restrictive, depending on where they plan to cruise, and make the possibility of making a claim impossible. Every policy is different, and you should ask for a copy of the policy wordings before you purchase the policy, highlight any exclusions or limitations. Some policies can be very confusing, saying there is coverage on page 2 but excluding that coverage on page 13, know what you are getting before you buy, if in doubt talk to a lawyer.


Liability insurance is fairly cheap and I consider a must have, in this day and age where people are looking for a quick buck and sue at the drop of a hat. So you can't just look at liability as the damage you do to a third parties property, if you claim you also injured them the costs can skyrocket.

We are on the fence with insurance for our cruising boat, liability yes, we may just self insure for the rest, but will look at the final costs and make our decision before we go.

[Sailmonkey]

We'll be going with liability only, the cost of full coverage combined with the restrictions just don't make any economic sense for us. Now for the liability part.....I have yet to search for coverage that extends throughout the caribbean and central america.

[rebel heart]

**** I work in insurance, sadly ****

We have full coverage now because there's still a loan on the boat and bank requires it. Three years ago or so we had some jackass slam into our stern and cause about ~12K worth of damage. I didn't have to pay a penny, because of our insurance which is about $2K a year or so. So right there, we're up on the numbers for a six year run.

When we leave we're dumping our insurance unless we can get a pretty amazing quote. I have a feeling that a 36 year old boat will cost too much and be rated too low to make it worthwhile. Our boat is our home and losing it would be heart breaking but not the end of the world. It would give me an excuse to build my own.

[FraidNot]

0.6% per annum

[rtbates]

Originally Posted by tager

Insurance is a scam.

Big time/...

[conachair]

I'm back with liability only as I'm back in the corporate rich west, using marinas again I wouldn't be comforable without 3rd party, all those big shiney expensive bits of plastic to hit.
At a get together in Brazil last year this topic came up, none of the boats around the table had insurance.

[gonesail]

insurance is a legal scam. we had hull coverage for a few years but dropped it and only carry liability which is cheap. the boat is paid for. if you dare make a claim then see what happens to your rates after that

[osirissail]

Insurance
- - If you have a bank loan on the boat you will be carrying/paying for full insurance.
- - If your boat has a market value of many hundreds of thousands of dollars, you will most probably be carrying full insurance.
- - If your boat will be in a USA marina/boatyard you will need liability insurance.
- - In a growing number of USA city mooring fields, you also will need insurance.
- - For basically all other circumstances and locations (except Mexico, Italy) you do not need insurance so it is really just personal preference.

[nautical62]

Originally Posted by SvenG

...The insurer would only cover less than one quarter or what an equally reputable surveyor said was the replacement value....
-Sven

Rather than conclude insurance is not worth while, I'd consider finding an insurance company that will provide better coverage. I've insured 4 cruising boats now including a 1969 model and never had a company say they'd only insure 1/4 the value.

[shipofools]

Originally Posted by MoonlightSailor

We will start cruising next summer and will be researching insurance very soon. However, we have obtained personal property insurance from USAA.

I was recently in touch with USAA insurance. Their personal property insurance will insure everything on the boat that is not attached to the boat in the event of theft or sinking. The personal belongings can be anywhere in the world and be covered. i.e. extra anchors, stowed rope, dishes, cothing, safety equipment, weather gear">foul weather gear, tools, computers, extra sails, extra parts for just about anything...It will add up. Inventory everything.

Some insurance is a rip...not all.

USAA rocks but you need to be US military (or by association/relationship) to become a member.

[osirissail]

It is my understanding that there are basically two types of boat insurance - 1. depreciated value of the boat and 2. agreed-value of the boat.
- - With older boats it is normally the second "agreed-value" of the boat type policy that you can get. Both you and the actual insurance carrier must agree on an amount so there is some dickering back and forth. Normally, the higher you set your value the higher they will set the premium.
- - The danger is in setting too low a price. Normally procedure after a comprehensive loss/damage is to get a survey of what it will cost to repair/restore the boat. If that amount of money exceeds the agreed value of the boat - the insurance company takes possession of the boat and cuts you a check for the agreed value. There are some variations on this, but that is the basic idea.
- - The danger is that you will lose the boat to the insurance company if your agreed value is too low. You can buy it back from them afterward, but then they charge you the amount they gave you - so you end up with a broken boat and no money. Not a good deal - it happened to several boats down here in Grenada after Hurricane Ivan. Some really unhappy cruisers who thought they were "saving money" by under-valuing the boat.

[rourkeh]

We went through the insuranse non insurance dilemma when we bought our boat in July. We got the boat for less than half of market value and are doing a major refit which will cost $75,000. The insurance companies these days will only insure the vessel for what you paid, not what it would cost to replace it. They will however give credit for the extra equipment we are installing but not the labour to put it in. Extra premium as value increases too. We decided to buy the coverage $2,300 a year, just to be safe. We have a $7,000 dingy/motor, and alot of personal effects as well so others may get a lower quote for $50,000 boat. Also we spent the whole hurricane season in the Bahamas. Glad we got the insurance as we got struck by lightning on our way to the islands from Connecticut after only having the boat for 6 weeks. The claim was $25,000 and they have paid already. So you rolls the dice you takes your chances. I have owned boats for 35 years and always bought insurance, but have never had a claim until the lightning strike. If you can afford to loose everything you have invested in your boat tomorrow and go out and replace it the day after with cash then you probably don't need insurance

[capn_billl]

Having worked in the Ins. business I can tell you how much of a scam it is. Up to 90% of what you pay for your ins. is paid out to the agent in commisions. the other 10% is used to pay any claims. That said. I have full coverage, (required by the bank). As soon as I pay it off, I'm changing to a bare bones liability only. If I buy a boat too expensive to afford a replacement, (I'm buying way too expensive of a boat), I would buy the highest deductible I can get. Use the saved Ins. premiums to save for a rainy day. Most people will have saved up enough to buy a new boat cash long before you would have had a claim. Use INs. only to protect yourself for what you cannot afford to lose. ( and know you will pay through the nose for it).

[svHyLyte]

Originally Posted by SvenG

We just got a quote from one of the more reputable insurers (often recommended here). To say that it was disappointing is an understatement.

The insurer would only cover less than one quarter or what an equally reputable surveyor said was the replacement value. That coverage would also be less than one half of what we will have sunk into the boat after the refit.

Sven,

"Replacement Value" is meaningless. It is essentially the current cost of a new boat similar to the boat surveyed. It really has nothing to do with the current actual value of your boat which, frankly, has little to do with how much money you may pump ito it. People frequently spend more on restoring/improving a boat/house/car than the darnned things are "worth" for any number of reasons-none of which matter to the "market".

Ericson 39B's were pretty nice boats but today can be had in reasonable shape for around $50,000 USD or less. If one has done a major refit, it is not impossible to get some of the costs--primarily for equipment up-grades/replacements--included in an "Agreed Value" policy but certainly not costs expended to restore the boat to seaworthy condition which is an expected "given". An insurance survey by a knowledgable surveyor who includes comparable market sales data coupled with your documentation of your refit and equipment purchase should put you in good stead for an Agreed Value policy for a resonable premium.

Our own Markel "Helmsman" policy was arranged by International Marine Insurance Services ("IMIS") and is very satisfactory although for quite a bit less than we have in the yacht and relatively expensive because of our location within the hurrican belt during the season. Given your location in SoCal, you should not have too much difficulty obtaining a reasonable coverage through IMIS, BoatUS or one of the many insurance brokers active in the SoCal market.

In contrast with some, I do not think all Insurance is a "Rip-Off". When an insurer is problematic, it doesn't last long, particularly now with the speed with which information is diseminated in forums such as this. I do think, however, that some people are quite willing to abuse insurance coverage, and particularly so during poor economic times. That, of course, makes life more difficult for every one else, no?

FWIW...

[trinescape]

originally we sold our house to fund our trimaran so everything we had was tied up in that vessel so to me paying 1,600.00/year was a no brainer if something happend we could atleast start again .It makes me wonder when i hear people say iam careful so i dont need insurance ,they may be carefull what about everybody else on the water and as the old saying goes ''**** happens'' cheers andy