Commercial Boat Insurance: Why It's Essential (Even Without Legal Mandates)

You may ask this question, why commercial boat insurance is important, when neither federal nor state laws of United States have specific regulations about commercial boat insurance.

Commercial Boat Insurance
Even though there are no federal or state laws that require commercial boat insurance, it’s the general consensus that it’s still necessary to have. It’s important to understand why it’s important. Here are just a few reasons why:

When you have insurance coverage for your commercial boat, you are protecting yourself in the case of adverse circumstances.
The premiums for commercial boat insurance are not very high.

With commercial boat insurance coverage, you provide financial security for yourself in the event of damage incurred to the boat, or damage or injury to a third party, due to an accident or unforeseen event.

Important Points
Check in to the types of losses covered by your insurance policy. Make sure that your boat insurance policy covers natural as well as man made disasters like sinking, theft, fire, collision floods and hurricanes. It’s better to know this up front than to be confronted with a coverage issue later when you really need the coverage.

An insurance company is also liable to pay for repair charges of the motor and other minor repairs of the boat to the extent of the coverage amount. You can also include the trailer used in transporting the boat in the insurance policy.

Assessing the Loss
In event of loss, you have to consult a  boat insurance expert. He will be able to guide you through the procedure to be followed in the event of loss. Make sure that you are given the coverage instantly. It is advisable that you take the quote in writing. Ask them about what formalities they will need to be completed to ensure coverage. As with any type of insurance policy, there may be some red tape to deal with.

In case of an emergency like sinking of the boat or accidental fuel slip, boat insurance companies are liable to pay for towing the boat. Generally in an emergency situation this will need to reimbursed to you later, as action needs to be taken on your part immediately.

Premiums
One of the deciding factors for the insurance premiums for the commercial boat is the price of the boat.

The US boat insurance rates also depend upon certain risk factors.

• The age of the boat will affect the rate of insurance. If your boat is new, you will have to pay higher premiums.
• Your past history as a sailor is important for deciding the policy premium as well. If you have had accidents in the past, then your rates are likely to be higher.
• Training undertaken by you is also a deciding factor. If you have attended training programs at recognized institutes that are governed by the National Association of State Boating Law Administrators (NASBLA), you may entitled to a discount on your boat insurance.
• If your boat is well equipped with safety equipment like fire extinguishers, emergency equipment such as life rafts and safety features, you will probably receive lower premium rates.