Liability Insurance For Boat Owners. What is it? Why Do You Need It?
No matter how experienced and careful you are, accidents happen. Although Most choose to insure their sailboat with a comprehensive policy that covers the value of the vessel, medical expenses should a passenger get injured, and 3rd party liability, some owners opt for a “Liability Only” insurance policy.
By law, many sailboat owners not are required to carry liability coverage, sometimes called Protection & Indemnity Insurance in case they cause damage or injury to others, others property, or the environment. Boat owners need to ask themselves the following question:
CAN I AFFORD TO PAY FOR INJURIES AND PROPERTY DAMAGE TO OTHERS, ENVIRONMENTAL DAMAGE, AND ANY LEGAL FEES ASSOCIATED?
There is a common misconception that homeowner’s liability is sufficient coverage’s for the risks faced by a boat owner, which in most cases is insufficient.
Below is a list of risks and covers included in many liability insurance policies:
Bodily Injury To Others & Damage to Others Property
Liability Insurance Covers you, up to a specified amount, for damage that you cause to others and their property, along with the legal fees involved.
Here is an example of this sort of claim:
You and a few friends are sailing on your boat you decide that it’s time to tack in order to avoid a collision with a boat ahead. As you start to come-about one of your lines gets tangled and you lose steerage, causing a collision with the boat ahead. During the collision one of the guests on your boat is injured, two of the people on the other boat are injured, and the hull of the other boat is severely damaged. Under maritime Law, you are legally responsible for all of this damage. This includes your guest’s and the guests of the other boat medical bills as well as any property damage caused. Legal fees will most likely rack up quickly, and there almost always be a settlement, in this case a large one. Sailboat Liability Insurance will cover you for the as legal fees as well as the damage caused up to a specified limit.
Fuel Spill Clean Up
Most Liability Insurance covers you, up to a specified amount, for the costs associated with an accidental fuel spill clean up.
Here is an example of this sort of claim:
You are running your engine and realise that you are low on fuel. Being the prudent boater that you are, you remember that you carry a 5 gallon emergency supply of diesel in a jerry jug on deck. As you begin to pour the fuel into your tank, a wake from a nearby boat throws you off balance and you drop the fuel jug into the water. Gallons of diesel are released. You are legally liable for the costs associated with cleaning up all of this fuel. In most cases either the coast guard or a professional company will need to be called and you will have to pay the bill, which can be extremely expensive. Sailboat Liability Insurance will cover you up to a specified limit for this clean up, as well as any legal fees associated.
Environmental Damage
Environmental Liability Insurance protects you, up to a specified amount, for any costs resulting from environmental damage you may be responsible for.
Here is an example of this sort of claim:
Lets refer back to the previous incident where you accidentally spilled diesel into the harbor.
You are running your engine and realise that you are low on fuel. Being the prudent sailor that you are, you remember that you carry a 5 gallon emergency supply of diesel in a jerry jug on deck. As you begin to pour the fuel into your tank, a wake from a nearby boat throws you off balance and you drop the fuel jug into the water. Gallons of diesel are released and the tide sweeps the fuel into a nearby marine sanctuary. The fuel kills animals and causes severe damage to the sensitive ecosystem. You are legally liable for the costs associated with the fuel clean up as well as the cost of restoring the environment to it’s previous state. Sailboat Liability Insurance will cover you up to a specified limit for this clean up and restoration as well as any legal fees associated.
Wreckage Removal
Wreckage Removal Insurance protects you, up to a specified amount, for the costs of having to remove the partial or whole wreckage of your vessel. Contrary to popular belief, if your boat sinks, you are still responsible for the safe removal of the wreckage and any liability associated with it.
Here is an example of this sort of claim:
Your boat breaks free from it’s mooring, anchor, or dock during a storm and drifts into nearby rocks, breaking apart and sinking. You are responsible for removing the wreckage from the rocks, which can be very expensive. Sailboat liability insurance will cover you up to a certain limit for the costs of this wreck removal and the legal fees associated.
Make sure you’re covered.
All of the above risks can be covered by one of our many available specialist Marine Liability Insurance Policies, and we will tailor each policy to your specific needs. Speak with Hanham Insurance Agency today and we will advise and arrange a policy that is right for you.
* Please note that all information contained above is a recommendation and you should not consider yourself covered until you have spoken directly and confirmed with one of Hanham Insurance Agency’s licensed Agents, or unless directly stated in your insurance policy.