When it comes to vessels, oil and water don’t mix – are you covered?

If you’re a boat owner, chances are you’ve overlooked getting the right boat or personal watercraft insurance. You may have been under the impression that your homeowner’s policy also covered your boat. The truth is that some homeowners policies offer limited liability insurance for boats, where the determining factor is usually the horsepower of the boat engine. It is best to review your policy carefully and discuss your specific situation with your insurance agent.

Now is a good time to make sure you have the right coverage. And if you do have a boat or vessel policy, what exactly is covered? There are several coverage options for boat owners to ensure their boat and its passengers are protected. These options include property damage, vessel liability, medical payments, fuel/oil liability, uninsured vessels, boating equipment and emergency services.

I think of the environmental disaster of the Gulf of Mexico oil spill, and boat owners have expressed concern about contingency coverage. An oil spill from your boat can have serious financial consequences if you are personally responsible for paying for the cleaning. These types of occurrences are usually covered by the watercraft liability coverage on the boat owner’s policy. However, some policies have separate limits specific to heating oil liability.

Keep in mind that a personal umbrella liability policy, which provides an additional cushion beyond normal liability limits, does not extend to fuel spill liability. That’s why it’s very important to list $500,000 or $1 million in fuel spillage on the boat policy to make sure you’re protected.

It is also possible that boat owners do not take other providers into account when purchasing their policy. If you are borrowing someone else’s boat, make sure your policy covers your liability on that boat, including fuel spills, which are described under non-ownership boat liability coverage. While some boat policies will cover all “permissive operators” who operate the boat with permission, some boat insurance policies may only cover the operators listed on the policy. Additionally, if someone is driving your boat and causes a serious accident, they may be covered as a “permissive driver” but be careful as your policy may only cover those individuals specifically listed as operators on your boat policy. And this is one case where a personal umbrella liability policy can come in handy. While this policy covers your liability exposure when operating someone else’s boat, there are underlying limits that will likely leave you with a $100,000 or more gap.

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But here’s the good news! There are a number of discounts that can help you save on boat insurance. These discounts may relate to new boat and diesel engine policies. You may also be eligible for a multi-policy discount on your boat and car insurance. And don’t forget that you may be able to earn discounts for successfully completing certain boating courses.

Talk to your local insurance agent for more information. Safe sailing!