Insurance renewal... ouch

[jms02050]

Just got my renewal notice from BoatUS - a whopping 28% increase. I've decided to at least shop around for another insurer. Curious to see who others use and if the increases are across the board due to recent weather events.

[joreyn]

That's a big increase. As an insurance broker, let me offer some advice. Be sure you understand exactly what you are buying before you write the check. There are huge differences in what is covered in private marine policies offered by different companies. BoatUS provides a pretty broad policy which covers the hull, its machinery and mechanicals, pollution, and more and offers very generous navigation limits. They pay for salvage of a damaged or sunk boat as well. It is what is called a yacht policy. Many other insurers also offer yacht policies - Chubb, Encompass, Seaworthy, to name a few.

Then there are "boatowners policies." These are more limited in coverage and are really designed for smaller trailerable boats such as ski boats and fishing boats. There is nothing wrong with them, but you should know that they don't cover the tings you had with a yacht policy. No coverage for your tender (you'll have to buy another policy for that) althoughy they do offer coverage for you trailer (but you probably don't have one).

If you leave your boat in the water during the full cruising season, you really want to have a yacht policy. When the Gecko offers you a great deal - its a boatowners policy.

[jms02050]

Hi. I sure do appreciate the advice. The challenge is always to do an apples to apples comparison - and I'll be sticking with a yacht policy. I still have sticker shock from the increase ...

[Marcy K]

Jim,

Where is your home port? I paid Boat US in full last October for this coming year - before Sandy and I am glad that was renewal time! We hail from Westbrook CT.

Marcy K
A 34 Paumanok 1986 Hull # 3

[jms02050]

Hi - I'm out of Scituate, MA.

[Captn_Dwt]

I switched to Boat US last year, after comparing policies. Their prices are competitive, but their service is beyond most. I'll be traveling this year, and I wanted good coverage... They even made it clear that my rate would adjust while I was on the inland waterways. Impressive. As for the "Sandy" increase: Insurance companies are in the "risk" business. They, as an industry, understand that the weather is changing for the worse. Ask them about climate change...they take it seriously. Be prepared for your home owners policy to go up also.
Here's to a good Summer!!

[joreyn]

It's not just Sandy that is putting pressure on premiums. It's ALL of the natural catastrophes all over the world. The earthquake in New Zeeland, the Tsunami in Japan, the tornados in SE USA, etc.

Insurance companies collectively don't take in enough in premiums to pay for such a surge in catastrophes. To cope with this uncertainty, they buy reinsurance (in other words, they take out their own insurance policies against catastrophe plagued years). Now, catastrophe reinsurance costs have increased dramatically. As a result, property insurance pricing is increasing, especially in regions where the known catastrophe exposure is greater.

Sandy was undoubtedly a part of it for BoatUS, and they did have an extraordinary number of losses in that event. But the reinsurance industry needs to get healthy again after several really bad years, and BoatUS can't afford to be without reinsurance.

From the "glass is half full" perspective: premiums for yacht and boat owners insurance had actually been falling since around 1984, with lots of competition driving the prices down. BoatUS was certainly one of the main competitors. Even with the 28% increase, one still might be paying less for the same coverage than was paid on 2004. Just saying...

[Nancy]

Just received the renewal from BOAT/US - 20% increase. I figure we got off easy since we're not on the coast.

[Pitou]

I've been watching the mail while following this thread and hearing other stories of significant increases. Through my Independent Agent, my Travelers Yacht Policy renewal arrived yesterday. A modest increase of 4.6% . Every few years I do a comparison shop with BoatUS and have always found BoatUS 20% or more higher in premium. I've been with Travelers Yacht since 1998.

Still inclusive of all previous coverage including an agreed value of $110k, tender up to 16 ft. w/ up to 25 hp motor, machinery breakdown (this is huge), pollution & salvage, $500,000 workers comp / longshoremen, $500,000 uninsured boater, 50% reimbursement up to $1,000 to haul and relaunch for a named storm, plus all of the per usuals. Deductible for damage or loss is $1,100. For additional coverage my homeowner's umbrella also extends over the boat. I do enjoy credits for Boater Education and Safety Gear. Navigational waters are restricted from Canadian border to Cape May, NJ. Layup is from 11/15 - 3/15.

Once again, 2 thumbs-up to Travelers Yacht.

[whwells]

Let me join Kevin in saying a good word for Travelers. Have been with them for many years out west. Have always found thier rates to be good,
Was with Boat US years ago and left for better rates. I do understand the insurance claim payments in the south and east must have a huge impact on the insurance industry.
Travelers service is also excellent. Gove them a try.
whwells "Howard"

[carolmarie]

ACE American Insurance Company's yachtsman policy is also VG and competitive.
carolmarie, 2001, 28TE, 6LP-STE.

[Nancy]

Thanks for the tip on Travelers. I got a quote from them, and they're within $7 of BOAT/US....but BOAT/US gives us a hefty no-loss credit, so the bottom line is 19% less than Travelers.

A notable difference is that with a liability limit of $300,000, the fuel and other spill liability limit from BOAT/US is $854,500, but from Travelers, it is $300,000.

[Yearwood]

Having spend many years dealing with marine insurance of all forms the best approach is to shop around with good underwriters every few years or when increases do not make sense to you. In my recent experience Boat US has not been competitive and Travelers has been.

[Joe/Fran]

Hi just spoke to our insuranc co. SeaInsure after reading our policy. The policy states it will pay on the agreed hull

value but our policy declarations page just states limit of insurance, no agreed hull value, also our origional policy

states the value of electronics and engine is depreciated on anything over two years. Called the company and spoke

Danielle who told us it is a agreed hull value policy but our policy has no such wording. She also stated there is no

depreciation . Does anyone really know the answer?

[joreyn]

If the policy says "agreed amount" then the amount shown in the declarations of the policy is the amount of the check you will receive in the event of a total loss. There will be no negotiating over depreciation, or "fair market value" or the like.

With yachts and specialty automobiles (collector cars), its so hard to agree on the amount of the loss AFTER the loss. So Agreed Ampout makes it easy on all parties. You agree BEFORE the loss and that's it! This is one of the best reasons to have a yacht policy and not a boat owners policy.

Having said that, how do you decide what the agreed amount should be? I advocate that you start with what similar boats are currently selling for, and then add on for any upgrades you've made to your boat (like that new Garmin suite you put in last fall). If you keep your fuel tanks full like I do, add in the cost of full tanks. THEN, consider whether you are likely to have to transport the replacement boat. If I replace Blue Moon with another 36ET, I'll most likely have to have the replacement transported from the East coast to Puget Sound. That could easily be $20,000.
Also, don't forget transaction costs like sales tax or excise taxes, and a thorough survey. That can add 10% depending on where you live.

Once you know what you think the agreed amount should be, then you need to make sure the underwriter will agree to that. Last year I got a quote from BoatUS. They would not agree to the amount I wanted, and offered $40,000 less. Since their premium was slightly higher than what I was paying for the amount I wanted, I renewed with the incumbent insurer.

If you can't get a reasonable agreement on value, go find a good independent insurance agent/broker. They typically have 5 or 6 options, and if the amount is within reason, they can get it for you.