Insurance Sticker Shock

[sailingmonika]

Well we finally came to agreement on the price for the boat we want to buy. We are buying knowing that we will put it in a charter fleet. It is a 52' Sailboat. I got the quote from the insurance company that has a fleet policy and was shocked at the deductibles. We have never had a sailboat in FL and the rate and deductibles were far less in CT than the rates I got here. It is a $7,200 deductible and 10% of the boat's sale price for any name stormed. Since we are putting it in a charter I cannot imagine that who ever takes the boat out would put up a $7,200 deposit. I am getting very nervous about moving forward with this deal as it seems like it be pretty easy to do $7,200 worth of damage on a $400K boat. The boat charters out for $5K a week during the prime season. Any insight into how this all works here would be appreciated. thanks all.

[billknny]

Originally Posted by sailingmonika

Well we finally came to agreement on the price for the boat we want to buy. We are buying knowing that we will put it in a charter fleet. It is a 52' Sailboat. I got the quote from the insurance company that has a fleet policy and was shocked at the deductibles. We have never had a sailboat in FL and the rate and deductibles were far less in CT than the rates I got here. It is a $7,200 deductible and 10% of the boat's sale price for any name stormed. Since we are putting it in a charter I cannot imagine that who ever takes the boat out would put up a $7,200 deposit. I am getting very nervous about moving forward with this deal as it seems like it be pretty easy to do $7,200 worth of damage on a $400K boat. The boat charters out for $5K a week during the prime season. Any insight into how this all works here would be appreciated. thanks all.

Florida insurance rates are really high. Boats get destroyed by weather all the time here. If it's not a named storm, it's garden variety lightning strikes and thunder storms. Look at a lightning strike frequency map and you'll understand...

About the only way to get relief is to have the boat north of ~31N for the summer.

We found that insurance rates for boats based in Florida are about 2X the rest of the east coast.

[Lazy1]

Seems like you are becoming an insurance company. Charge a $2k deposit if you think you will have one claim for every 4 charters or more if you expect more frequent claims.

[sailingmonika]

I appears that the charter companies have the folks chartering sign insurance Yacht damage waivers where they pay $40 a day and have a $1000 deductible. If they damage the boat they have to pay the $1000 but that policy covers our deductible which is $7,200. I guess they make enough money on these $40 a day rates to underwrite these policies. Lot's of stuff to consider. Thanks to all for helping us navigate this purchase.

[kerrydeare]

Originally Posted by sailingmonika

... the charter companies have the folks chartering sign insurance Yacht damage waivers where they pay $40 a day and have a $1000 deductible. If they damage the boat they have to pay the $1000 but that policy covers our deductible which is $7,200. I guess they make enough money on these $40 a day rates to underwrite these policies ...

Cynicism on my part perhaps, but if you are getting into this yacht and looking for even a small amount of financial justification or relief, it's going to be a long winter.