Insurance - Country of Residence or Flag?

[Montanan]

Originally Posted by Alan Mighty

The line in bold type, suggesting a length limit of 12 metres for entry on the Australian Shipping Register, is nonsense. There is no such limit for a pleasure craft or commercial vessel.

The more crucial point is the OP's statement of being an Australian tax resident.

A person can be a tax resident of Australia without being an Australian national. A tax resident of Australia may not even be allowed to enter Australia without a visa.

In Aus, tax and nationality have little to do with each other. Tax residency is defined and managed by the Australian Taxation Office. See: https://www.ato.gov.au/Individuals/c...tax-residency/

Nationality is managed and defined by the federal Department of Home Affairs. Nationality qualifies for entry on the Aus Shipping Register.

Tax residency of Australia does NOT qualify for entry on the Aus Shipping Register.

An Australian resident [non-national] may register their vessel with the Australian Flag if it is less than 12 meters in length. The OP's Amel is longer than 12 meters thus would require the owner to be an Australian national.

References:

https://www.amsa.gov.au/vessels-oper...pping-register

How to register your vessel

To register your vessel on the Australian general shipping register, you need to:

Confirm your ship is eligible
Your ship is eligible if it fits one of these categories:

It is Australian owned
It is on demise charter to an Australian based operator
It is less than 12 metres in length, owned or operated by an Australian resident.

[Brendan]

Originally Posted by goboatingnow

The flag does have an effect as insurance taxes are based on the “ nationality “ of the boat. For example my insurance with Pantaenius is slightly more if its British flagged then Irish flagged ( it was insured initially as U.K. then reflagged to Ireland ) as the Gov insurance taxes are higher in the U.K.

Also for example Pantaenius reinsure with different sets of underwriters depending on the flag of the boat.

Confirmed, I’ve had the exact same experience with the same countries and insurer.

[Montanan]

Insurance regarding boats relates to both Maritime Law and Contract Law and the jurisdiction of where the claim originated and of the claimant.

By way of example:

A new EU ruling determines that prorogation of jurisdiction can be validly agreed in a yacht insurance contract, even where consumer interests are concerned and the contract requires that legal proceedings be brought in a court in the insurer's home country. Pursuant to the ruling, a private policyholder who is an EU citizen and purchases boat insurance in another EU country is bound by the jurisdiction agreement in the insurance contract.

[goboatingnow]

Originally Posted by Montanan

Insurance regarding boats relates to both Maritime Law and Contract Law and the jurisdiction of where the claim originated and of the claimant.



By way of example:



A new EU ruling determines that prorogation of jurisdiction can be validly agreed in a yacht insurance contract, even where consumer interests are concerned and the contract requires that legal proceedings be brought in a court in the insurer's home country. Pursuant to the ruling, a private policyholder who is an EU citizen and purchases boat insurance in another EU country is bound by the jurisdiction agreement in the insurance contract.

I presume you are referring to the


The European Court of Justice – Assens Havn -v- Navigators Management (UK) Limited C-368/16

Which concluded that you can sue your insurance company in your own member states courts irrespective of the jurisdiction mentioned in the contract

Note it doesn’t “ require “ it to done so , merely that’s it’s possible to do so.

[meirriba]

You got a lit of answers that confuse the issue.
Short answer is:
You may insure your boat with any company that
1. Agrees to insure you (the company may be based in the flag, residence or unconnected).
2. Offers reasonable premium.
3.You believe that they will stand by you in an hour of need.

[Yes maybe]

Originally Posted by yachtgemini

Some interesting questions buried in there. I am also Australian, had my boat Oz registered but insured in the UK.

My insurers were fully aware of the boats flag, my citizenship and residency but advised it was only required for information and 'know your customer purposes' but was not significant for the insurance decision.

My understanding from when I asked this question of my insurers some years ago was that the jurisdiction for legal matters was clearly specified in the policy. That mentioned claims, payments, arbitration and legal action. Further it specified governed by the laws of England and Wales.

The next issue is when you start cruising will you have enough links back to Australia to maintain tax residency. I did not and the Australian insurers declined to offer me cover.

Many of the British brokers and insurers are fairly used to dealing with these situations and will offer cover.

Australian registration was an excellent flag to travel through Europe with as it removed ambiquity in the various customs officials minds over our VAT status... a bit of a red herring I know but they seem more questioning about EU flagged boats with non EU owners.

Ross

Some good info from experience. Especially regarding, legal jurisdiction for the origin of the policy (where legal action regarding the policy would take place) and maintaining tax residency, for Aus based insurance.

I understand the officials questioning EU flag and non EU owners. Anything slightly different and gears driving all the regulations start to seize up

[Yes maybe]

Originally Posted by rwidman

If you want an answer that you can count on, ask your insurance company, not strangers on the Internet.

It doesn't matter what people say here, what matters is what your insurance company says.

Agree, with your point above. But some EU based insurance will provide quote and policy and some will not. I have asked for clarification, but nothing comes back.
Actually, a lot of the info provided in this thread is quite helpful and puts concepts into the right perspective. Nothing like real world experience.

[Yes maybe]

Originally Posted by meirriba

You got a lit of answers that confuse the issue.
Short answer is:
You may insure your boat with any company that
1. Agrees to insure you (the company may be based in the flag, residence or unconnected).
2. Offers reasonable premium.
3.You believe that they will stand by you in an hour of need.

OK, consise.

Point 3. I would like to believe, but i think some insurance products may not stand by you in hr of need. Depending on what they can manipulate from point 1.

[Dogscout]

I'm a US citizen, my boat is flagged US and USCG documented. My boat is located in the med and my insurance company is based in Malta. I have no other interests in Malta. Well I do like going there.

[ccannan]

Originally Posted by Dogscout

I'm a US citizen, my boat is flagged US and USCG documented. My boat is located in the med and my insurance company is based in Malta. I have no other interests in Malta. Well I do like going there.

Please share the name of your insurance company.

[goboatingnow]

Where the insurance company is based has little consequence

[CdS2 Roland]

Hello,
As far as I know, I'am Swiss, my boat is under French Flag trough French Company, my insurance Swiss Company... European tax laws oblige every insurance company to collect the VAT for the country of flag. For exemple 20% in France. So I think if you have your boat under Poland Flag, they will collect polish VAT on your insurance.

[meirriba]

Originally Posted by CdS2 Roland

Hello,
As far as I know, I'am Swiss, my boat is under French Flag trough French Company, my insurance Swiss Company... European tax laws oblige every insurance company to collect the VAT for the country of flag. For exemple 20% in France. So I think if you have your boat under Poland Flag, they will collect polish VAT on your insurance.

AFAIK there is no VAT on insurance premium anywhere.
Some countries levy an insurance tax (few percents usually) and this is included in the premium.
So, once again, you may insure your boat with any company in the world subject to this company doing business in the area you either sail or reside and its willingness to sell it to you.
Ask for quotes, compare costs, and compare claim settlement history.

[JAFO]

Originally Posted by yachtgemini

Some interesting questions buried in there. I am also Australian, had my boat Oz registered but insured in the UK.

My insurers were fully aware of the boats flag, my citizenship and residency but advised it was only required for information and 'know your customer purposes' but was not significant for the insurance decision.

Someone please correct me if I'm wrong, but based on my reading, my understanding was that (and this may have been a recent change) if insured, a boat registered in Australia must, by law, be insured with an Australian insurer.

[badadim]

It is a good one and while there are a lot of "simple" options you may like to have a closer look from this angle:

There are 2 major components in marine insurance: liability and hull


#1: Liability is covering owner's and operator's liability. Who is the owner? You as an individual, your spouse as joined owner, LLC or LTD or INC?
Liability insurance protects assets and income in case of legal claims, so the owner's and the operator's assets and income must be taken into account here.


#2:Hull protects the vessel and the content.



These components are often called :"insurable interest" and each may have a different residency (domicile):


Q1: What is the residency of the owner and the operator, their assets and income you are protecting?


Q2: What is the residency of the vessel (the hull), or domicile of the vessel registration (keep in mind there are un-flagged vessels too).


Once you establish the answers to these questions it becomes a matter of practicality for each step:

- getting insurance advise
- governing law of the policy
- how easy it is for you to resolve disputes with your broker/insurer
- how easy a potential claim will be handled
- will they take you as a client?
- reliability/rating of the insurer, coverage provided, exclusions, small print, cost...


Those who are in BC, Canada try reaching out to Ina who can help: https://shop.insurebc.ca/ina