What’s the Difference Between Boat and Yacht Insurance?

What’s the difference between boat and yacht insurance?

In the world of insurance, the typical rule is that a vessel that is 26 feet long or shorter is considered a boat while a vessel 27 feet or longer is considered a yacht. While the main components of a boat and yacht policy are the same, yacht coverage tends to be more specific in wording, with specialized conditions, because yachts tend to travel longer distances and are exposed to different risks.

The Components of a Boat Policy

Most homeowners insurance policies do include coverage for very small boats, usually with a horsepower ranging from 25 to 100, but nothing larger. There are often very specific exclusions that limit where you can use your boat and how far you can travel. Boat owners who plan on using their boats in major waterways are better off working with a marine insurer.

The basic components of a boat policy include:

  • All risk coverage for the boat itself (includes all claims types except for items specifically excluded on the policy, like wear and tear or ice);
  • Liability and uninsured boaters liability to pay for damages you cause others or their property;
  • Permanently attached equipment and essentials like anchors, oars, and life jackets;
  • Specialized coverage for removable personal property or special items, like navigation equipment;
  • Towing and assistance to aid you in returning to land after a covered incident;
  • Consequential damage is available for losses that occur due to wear and tear (like corrosion or rot); and
  • Cruising extensions for those who plan to leave the USA.

Not all of these options are automatically included with every boat policy. Your insurance company will also take a number of factors into consideration when deciding how to cover your vessel, including but not limited to:

  • Age
  • Length (under 26’ or over 27’)
  • Monetary value
  • Motor speed, horsepower, and type (inboard, outboard, performance, etc)
  • Area of operation

No matter what type of vessel you have, boat or yacht, anyone who lives in a hurricane zone will usually be asked to provide a plan to the insurance company. The plan will detail where you will take your boat if a hurricane approaches your normal harbor. Will you take it to an inland facility or move it to a safer harbor? Not having a plan, or not following your plan, could make you ineligible for coverage.

There are a number of great marine options available for boats of all sizes. Talk to your insurance professional about your vessel and be honest about how and where it is used. The length of your boating season, whether or not you store your boat, and even your boater education history can make a huge difference in choosing the type of policy that’s right for you.

Comments are closed.