Performance Boat Insurance: Understanding Associated Costs & Coverage

Performance boat insurance is necessary for boats that are used in boat shows or boat racing. Performance boats are a special class of vehicles that have different risks associated with their use. These risks can be protected against by purchasing an appropriate level of insurance coverage.

Speed and Performance Boats

Speed and performance boats have characteristics that are more sophisticated than other types of boats. The owner of a performance boat, as with the owner of performance motorcycles and cars, need a level of protection that provides a benefit for the associated costs of owning and operating these vehicles. Providing this coverage comes at a premium to the boat owner beyond what they would expect to pay for normal boat insurance.

Premium Costs

The premium costs associated with a performance boat insurance policy are much higher than they would be for a traditional boat insurance policy. The premium factors and risks associated with speed and performance boats present a higher risk of loss and need a higher level of premium support in order to provide a benefit. The costs include the risk of damage and salvage due to the performance use of the boat, which is what it is designed for. Speeds achieved by these vehicles are vastly superior to regular boats and present a higher risk exposure to the owner and insurance company. The higher risk is due to the speed these boats generate and the greater exposure to being damaged resulting from the speed.

A performance boat owner may wish to purchase extended warranties on items such as the hull and machinery. The exposure to loss is greater for these items than it is for normal boats. Using the boat as it is designed will result in a greater loss exposure and the insurance company will need to compensate this with higher premiums.  

Getting a Quote

The premium costs for these policies can be as high as 5 times that of a normal boat insurance policy. Getting a quote for a performance boat is necessary to determine the costs on a basic policy and the cost for extended coverage to make sure that your benefits match your usage of the vehicle. Comparing the costs with different insurance companies will help you decide on the best coverage available at a reasonable cost.

Purchasing a performance boat policy does require some comparison shopping and a look at the costs of basic and extended coverage. Looking at the benefits that a policy provides should be first and foremost over the costs as you should expect to pay a significant amount of premium for performance boat insurance coverage.