Do You Have to Have Boat Insurance?

Do You Have to Have Boat Insurance?

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Most states don't require boaters to purchase insurance for their watercraft. However, many marinas do require some form of insurance if you wish to use a slip or mooring. Additionally, your bank will require insurance if you are financing the purchase of a boat. Even if these requirements don't apply in your situation, it's still generally a good idea to get boat insurance.

Who may require you to carry boat insurance?

If you intend to finance the purchase of a boat, your bank will require you to provide proof of insurance for the watercraft. Typically, the policy will need to cover the full value of the boat, and your bank may set minimum requirements for specific types of coverage. In addition, you will need to list the bank as a lienholder on the policy so that it will be included as a co-payee on any compensation in the event of a loss payment.

Most ports and marinas will require you to carry boat insurance in order to use their facilities.

For example, if you want to moor your boat at Port of Bellingham in Washington, you must carry a policy with at least $300,000 in general, legal and pollution liability with a policy term of no less than one year. As another example, the Hawaii Division of Boats and Ocean Recreation requires all vessels moored at its facilities to carry at least $500,000 in liability insurance.

Some marinas, such as the Hawaii Division of Boats and Ocean Recreation, may even require that the marina itself be listed as an "additional insured" or "additional interest" on the policy. You'll normally need to provide proof of insurance before you can sign a contract for a slip or mooring.

Boat insurance requirements by state

Generally speaking, you won't be required by your state to purchase boat insurance. In fact, only a handful of states require boaters to purchase insurance, and the requirement is often limited to boats with engines rated to have at least 50 horsepower.

Arkansas, Hawaii and Utah are the only states that require boat insurance.

The table below lists the insurance requirements for each state.

Is boat insurance required?
ArkansasLiability insurance with at least $50,000 in coverage is required for all boats powered by engines of more than 50 horsepower.
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Should you get boat insurance?

Boats can be covered under a homeowners policy, but generally, there are limitations on the size and value of boats that may be carried on such a policy. In many cases, the value of the boat cannot exceed $1,000 or $2,000. While this coverage is ideal for small, non-motorized boats, such as canoes or kayaks, it is not sufficient for larger or motorized boats. What's more, many homeowners policies will only cover the boat if it is physically damaged on your property; damage while it is in the water is not covered.

It is generally recommended to purchase boat insurance.

Boat insurance is similar, in many respects, to auto and homeowners insurance. As with a homeowners policy, you can choose between the actual cash value or replacement cost in the event of a total loss. You'll be covered if someone is injured on your boat. Similar to an auto insurance policy, you can also purchase comprehensive and collision coverage (commonly called "hull insurance"), along with coverage for bodily injury and property damage. Additionally, many boat policies provide coverage for salvage costs, fuel-spill cleanup and damage from water sports.

Like with other types of insurance, there are add-on coverage options for your boat policy. These add-on options include:

  • Roadside assistance and on-water towing
  • Coverage for fishing equipment or carry-on personal property
  • Mechanical breakdown coverage
  • Ice and freezing damage coverage
  • Hurricane haul-out coverage
  • Trailer trip interruption

You can get discounts on your premiums for signing up for multiple policies through a single insurer, taking a boating safety course, receiving a boater education card or license, limiting your boating to a specific geographic area or having a good driving record on the road. Some insurers even offer diminishing deductibles for each year in which you do not file a claim.

Frequently asked questions

Is boat insurance a good idea?

Boat insurance is a great option to protect you and your watercraft. Like home insurance, you'll be covered if someone is injured on your boat, and similar to auto insurance, you can purchase comprehensive and collision coverage for your watercraft.

What is the purpose of boat insurance?

Boat insurance helps protect you and your boat from certain risks like theft, collision, or storm damage. It also covers your boat whether it's in the water or on land.

How much is boat insurance?

On average, boat insurance is about $200-$500 per year.

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