Charter deposit insurance

[mrshyt]

Hello - we are looking to charter a cat for 2 weeks in Martinique. Deposit on the boat is €4000 and the charter company do not offer a daily waiver fee as an option, they have suggested I look myself if interested. So I got a quote for the 2 weeks - the quote itself is reasonable (€10 a day or so) only that the insurance itself has an excess of €500, so it doesn't cover the first €500 of any claim - it doesn't sound like a great deal to me, is this normal?

I would still have to leave the €4k deposit to the chartering company, even if I do get the insurance.

Any info / response is much appreciated!!

[skipmac]

Have only chartered a few times and only once in the last ten years so cannot say what is normal.

Regarding the question of is it worth it, I think has to be your decision.

The math is easy. You risk losing €4000 with no insurance vs losing €640 from the deductible and what you pay for the insurance. But if everything goes as planned you spent €140 extra for nothing but peace of mind.

I would ask what are the odds you will cancel the trip for some reason and decide on that basis.

[mrshyt]

Thanks skipmac. I was just a bit surprised with the €500 excess - I have read in other threads that people always go with the deposit insurance so that they can walk away from the boat in the end without worrying about anything - in this case (worst case scenario) we would still have to fork out up to €500.

But as you say, better €500 than €4000...

If anyone else has any thoughts, I would appreciate it!

Thanks

[skipmac]

Just to be clear, you refer to excess. I assume this is what we call in the states the deductible. For example, you insure a car for $10,000 but if it is totally wrecked or stolen the amount you are paid is minus the deductible amount?

Can't say for charter insurance but for almost all types of insurance I know of, a deductible on the payment is standard. That accomplishes a couple of things for the insurance company.

First it reduces the amount they have to pay on a claim so reduces their costs a little.

The biggest issue is that a deductible usually makes the customer more careful and motivated to work harder to not use the insurance.

If you could get paid 100% of the value of what you insure then you have zero risk in the business. In that case it makes it much easier for you to cancel the charter or if car insurance, perhaps be less careful about locking the doors or parking in a safe area to reduce risk of theft.

All this reduces the costs to the insurance company and reduces their charge to you. I know with my car insurance the lower I make the deductible the cost goes up a lot.

[jkishel]

Typically a bareboat charter includes a damage deposit. I assume this is what the 4000 euros is. If so, this is actually the deductible on the charter company's insurance. If the boat is damaged, the first 4000 euros of repair cost comes out of your deposit. The rest is covered by the company's policy up to the limit of the policy. This isn't trip cancellation insurance. You can buy that separately. I'm not sure what you mean by a "daily waiver."

[azsailor12]

Originally Posted by jkishel

Typically a bareboat charter includes a damage deposit. I assume this is what the 4000 euros is. If so, this is actually the deductible on the charter company's insurance. If the boat is damaged, the first 4000 euros of repair cost comes out of your deposit. The rest is covered by the company's policy up to the limit of the policy. This isn't trip cancellation insurance. You can buy that separately. I'm not sure what you mean by a "daily waiver."

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That has been my experience too- security or damage deposit covers the deductible or at least part of it. Some companies don't allow you to get your own insurance, you must purchase theirs.

[jkishel]

4000 euros seems pretty high for a damage deposit though it should be more like 1000, but then this is Martinique. If somehow the OP can insure his 4000 euro exposure with 10 euro per day, 140 euro with a 500 euro deductible that could be a good deal. If, on the other hand the 4000 euro deposit is not a damage deposit but is a down payment on the charter that would be forfeit if he doesn't show up, then trip cancellation insurance could be a good idea.

[mrshyt]

Hi All - in the end we will go with the "insurance excess repurchase" as the insurance company calls it. We had seen some other charter companies offer this insurance but the one we are renting from referred us to a 3rd party insurance company. Fingers crossed we won't need it!

Thanks all