109jb
Lieutenant Commander
- Joined
- Jul 15, 2008
- Messages
- 1,590
Re: How Many Boat Owners Have Boat Insurance?
I would not do this. If you get a stated value policy where you say your $8K boat is worth $4K and something happens the insurance company is only liable for $4k as stated in the policy. If they write your boat off as a total loss you get $4K and they get your boat.
Case 1 - Lets say that $8K boat is insured at a stated value of $4K and it gets $3500 worth of damage. This is over 80% of the stated value. They could just cut you a check for $4k and drive your boat away that still has $4500 value accounting for the damage.
Case 2 - Now same $8K boat insured for $8k and it gets the same $3500 in damage. This is only 44% of the policy value. They have to fix it.
Case 3 - Now if you don't have hull insurance and your $8K boat gets $3500 damage you still own a damaged boat with $4500 remaining value. Now you can decide to either fix it, or sell for the salvage value.
I would never under-insure the replacement value of a vehicle for this reason.
focus on the liability coverage first; that's the most important.
On old boats, consider liability only--though they often throw in some boat coverage for practically nothing. With the hurricanes, though, boat coverage is up.
Cut your rates with a high deductible. You wouldn't file a claim for less than $1000 so why pay for it?
Also save money by self-insuring part of the risk--if you have a $8000 boat, insure for $4000-if the math works on the premium difference.
I would not do this. If you get a stated value policy where you say your $8K boat is worth $4K and something happens the insurance company is only liable for $4k as stated in the policy. If they write your boat off as a total loss you get $4K and they get your boat.
Case 1 - Lets say that $8K boat is insured at a stated value of $4K and it gets $3500 worth of damage. This is over 80% of the stated value. They could just cut you a check for $4k and drive your boat away that still has $4500 value accounting for the damage.
Case 2 - Now same $8K boat insured for $8k and it gets the same $3500 in damage. This is only 44% of the policy value. They have to fix it.
Case 3 - Now if you don't have hull insurance and your $8K boat gets $3500 damage you still own a damaged boat with $4500 remaining value. Now you can decide to either fix it, or sell for the salvage value.
I would never under-insure the replacement value of a vehicle for this reason.