How much Third Party Liability Coverage?

[Sailmonkey]

Holy schnikies!!!! These numbers are nuts!! We carry 300k of liability only, I guess there's a reason we stay at anchor or in our run down hole of a marina.

[lorenzo b]

Life is a gamble. You buy insurance to satisfy legal requirements and protect your assets. Umbrella policies are pretty cheap and the coverage can be huge, but that only makes you a big fat target. The more you have, the more likely someone will try to sue you. Talk to your financial adviser and your lawyer. In any case, you are far more likely to drop dead from natural causes than get sued, so kick back and enjoy.

[goboatingnow]

Originally Posted by ullar

What's your region of cover?

Regards,
Ullar

Europe to 20 degrees east
dave

[goboatingnow]

Originally Posted by Sailmonkey

Holy schnikies!!!! These numbers are nuts!! We carry 300k of liability only, I guess there's a reason we stay at anchor or in our run down hole of a marina.

It must be a difference in US v European insurance, here liability cover in the order of several millions is standard in every policy from cheap to expensive, The primary factors in insurance cost are the vessel value, area and time extent of operation and crew numbers and experience.

Dave

[ullar]

Originally Posted by goboatingnow

Europe to 20 degrees east
dave

Thanks Dave. My coverage numbers are about a halve of yours and I pay about £350 for Baltic Sea. Perhaps I should start to shop around for next season? Anyways, I plan to have just an obligatory third party insurance when I start to live from savings and go further away.

[NorthPacific]

As a boater who paid insurance for 25 years without a claim I got upset when my bro cider decided that in December I needed an out of water survey before they would renew my policy. So on top of the $1000+ for insurance I was to pay another $1000+ for lifting and a survey.

Now I had noticed that my coverage had gotten more restricted and the fine print more elaborate and restricted. I saw red and told them to stuff it. Now they dropped demands cut my premium, but I had had enough. Now 8 years later I am ready to head off for the big trip. Obviously no one will insure me for blue water unless I am willing to pay big time which I am not.

This is partially because I can not afford it and also I have to prove that I can manage blue water first. Fair enough, I can see the logic in that. But the third party makes sense. Not so much that I am fearful of being sued, as if my boat sinks my only assist is a 10 year old Rav 4 (any offers). But I if my dream is destroyed by chance or fluke I do not want to have to live with destroying someone else's dreams.

Now I would imagine that someone with a 60 ft dream boat will have insurance up the ying-yang, or can afford to loose it without loosing sleep. However it is quite possible that when I drag anchor I could ruin the dreams of someone with more modest means.

I am a Canadian registered vessel anyone have suggestions on how I can get third party liability before I head out in a few months. I will be away from canada for several years. Well good as far as the boat is concerned. Cheers

Steve

[Hudson Force]

Location makes a huge difference with the cost of insurance. Many insurance providers dropped coverage for Florida registered boats after the devastating hurricane seasons of 2004 & 2005. I've kept only a liability policy since 2005. My premium for full coverage would have climbed to 8% of the average market value of my old boat for each year. Premiums have come down some in recent years in Florida, but I'm comfortable with my risk.

[poiu]

I asked my broker and was told the standard cover at $5m was more than enough. There are international agreements and laws to limit a claim against you so if your frying pan fire burns down the marina you won't be bankrupted. This looks like a good analysis. Note a few exceptions:

http://www.hilldickinson.com/pdf/Lim...0liability.pdf

[FlyMeAway]

Originally Posted by poiu

I asked my broker and was told the standard cover at $5m was more than enough. There are international agreements and laws to limit a claim against you so if your frying pan fire burns down the marina you won't be bankrupted. This looks like a good analysis. Note a few exceptions:

http://www.hilldickinson.com/pdf/Lim...0liability.pdf

The biggest "exception" is the US. Here's a great run-down on limitation of maritime liability in US law:

Limitation of Liability | Bluestein Law Firm PA | Charleston South Carolina

Note: the reason you should still carry umbrella coverage sufficient to protect your assets is a) the insurance company deals with the lawyers; you want them to have as much skin in the game as you do and b) "privity or knowledge" is a really tricky thing.

[poiu]

Originally Posted by FlyMeAway

The biggest "exception" is the US. Here's a great run-down on limitation of maritime liability in US law:

Limitation of Liability | Bluestein Law Firm PA | Charleston South Carolina

Note: the reason you should still carry umbrella coverage sufficient to protect your assets is a) the insurance company deals with the lawyers; you want them to have as much skin in the game as you do and b) "privity or knowledge" is a really tricky thing.

I can see the test for a claimant will hinge essentially on proving negligence, so once again a feeding frenzy for the lawyers. If enough is at stake they will have a go and argue black is white, which they can do so well. Those legal costs alone could bankrupt most. The insurers will cover this cost in a normal policy and will be motivated to win as their loss when limited will be usually $millions less than what they will loose if they loose the limitation case. How far do we need to go to protect ourselves from a charge of negligence in this context and what constitutes negligence?

Those of us who are from outside the US don't use umbrella insurance as we rely on our insurance and the limitation of liability conventions to protect us so we are really in a much better position to that in the US as even if negligence is proven and it renders the insurance policy void we could still rely on the limitation conventions to protect us from total wipe out.

I find that the need for umbrella insurance is rather frightening as well as the potential unlimited liability. I wonder how many people consider if their policy is adequate without it? I wonder if corporate ownership provides an adequate shelter?