Boat insurance for environmental cleanup?

[PiratePast40]

Just paid the annual premium for liability insurance on my boat and noticed there was nothing there concerning environmental cleanup. If there was an oil or fuel leak, I don't know if I'd be responsible for any of the cleanup costs. I called my State Farm agent and his response was that as long as the leakage wasn't caused by negligence, there was no specific exemption. He also went on to say that they can never really tell if a claim is going to be covered or not. I asked about the purpose of the boat insurance since I have an umbrella policy. His response to that was that the boat policy acts as the deductable for the umbrella in the event a lawsuit goes beyond the payout of the boat policy.

I still don't have a warm fuzz feeling about my insurance. Sort of feel like I was told to "endeaver to persevere". Do any of you have specific wording in your insurance policies that addresses cleanup costs in the event of a spill?

 

[skyking897]

Re: Boat insurance for environmental cleanup?

My wife works for State Farm and is kind of anal about having the right coverage (don't tell her I said that) . If our boat sank and caused a fuel/oil spill, we are covered for the clean up.

 

[geneseo1911]

Re: Boat insurance for environmental cleanup?

I have my boat with country companies, and that was one of the specific questions I asked about when shopping (state farm was my other option). My agent had to call an adjuster, but found out that the coverage does include recovery and cleanup of a sunken boat. The sf agent told me the same thing, and said he actually had a customer who hit a log at speed and sunk his boat in the Mississippi and sf covered the salvage and replaced the boat.

 

[cribber]

Re: Boat insurance for environmental cleanup?

Call Progressive and get a quote for your boat. After 4 years of no claims I'm now at zero deductible and have a balloon liabilty that includes salvage and cleanup.

 

[Home Cookin']

Re: Boat insurance for environmental cleanup?

"as long as the leakage wasn't caused by negligence, there was no specific exemption."

that's the dumbest damned thing I have ever heard, and proves why you can't rely on an agent to interpret your policy. You have liability insurance to cover your negligence! This moron is saying that it only covers you for intentional spills! That is seldom the case. if he's right, yo have no coverage--which is possible.

However, policies may limit the types of spills (slow leak v. sudden sinking) or those the insured caused in certain circumstances, or they may exclude them entirely. This is why you have to read the policy. And coordinate it with your other coverage, suchas HO or umbrella.

An insurance policy is a contract, nothing more, nothing less. Most are different, so you can NEVER EVER rely on what someone else's policy says (or worse, what he thinks it says).

Policies are hard to read and understand, full of double negatives and layered conditions, with state laws superimposed. then you never know what laws will apply. Put a couple of layered policies, some experienced insurance guys, 4 lawyers including insurance defense specialists and an admiralty guru, and a couple others with graduate degrees--and they will not be able to agree on what the policies do and cover and exclude for fatalities in a boating accident. BTDT. Pray you never get in that situation.

Umbrella coverage, which IMO is essential, is equally confusing.

ever price out oil clean-up and wetlands mitigation? frightening.

 

[JoLin]

Re: Boat insurance for environmental cleanup?

Real marine insurance (like my BoatUS policy), spells it all out, line item by line item. There's no confusing language. 'A spill is a spill is a spill' and regardless of why it happened (unless it was an overt criminal act), you're covered up to the policy limit. They also have a decreasing deductible if no claims are made.

Insure with an insurance company that 'knows boats' and what can happen to them.

My .02

 

[scoutabout]

Re: Boat insurance for environmental cleanup?

A marina we no longer use tried to tell us our insurance wouldn't cover the sinking and salvage of our SeaRay several years ago if the cause turned out to be negligence (bad bellows overdue for replacement for instance). Our insurance agent just laughed when I called her to check. "We cover stupid too" was essentially her response. Her only concern was an intentional job and they did send someone the hundred miles to have a good look at it.

(In the end they chalked it up to the unusually severe storm it weathered at the dock unattended over a period of days prior to it going down. Still one for the stupid category I am sure you will agree. That incident marked the end of our family's forty year habit of May to Oct in-water mooring over a span of about six different boats without a mishap. Our complacency with respect to single batteries and bilge pumps finally bit us in the rear. With the Scout I've gone a bit anal the other way, specifically buying a boat with a self-bailing cockpit and when we aren't actually at the lake, she's on the lift.)

 

[Home Cookin']

Re: Boat insurance for environmental cleanup?

scout, if your boat sank due to to failed bellows, then I wouldn't say you were stupid, but I also wouldn't leave an older boat with bellows in the water. Another reason on the long list to have an OB.

when looking at what is "covered" you have to be specific. Failed bellows themselves would not be covered but cost of clean-up and salvage might be. repair/replacing the boat might be. It's all based on what the contract says.

But generally, "liability" coverage is for negligence--because liability arises from basically three things: negligence, intentional acts, strict/statutory liability, all of these sounding in torts. Liability, of course, can also arise from contracts--which may include your marina lease.

BTW my boat club is requiring us to name the club as an additional insured on our policies

 

[PiratePast40]

Re: Boat insurance for environmental cleanup?

I was able to find an example copy of the policy and it seems as though wreck removal would be covered if required by law. However, that is in the initial part of the coverage that covers the boat. State Farm won't provide loss coverage on my boat because of it's age.

I've send an email to the main office to try to get some resolution.

 

[geneseo1911]

Re: Boat insurance for environmental cleanup?

What?! They are currently insuring my '69 Larson (which I still haven't sold ...).

 

[PiratePast40]

Re: Boat insurance for environmental cleanup?

Finally got it straightened out but had to talk 4 different people to find someone who could decipher the policy. I'm covered for any claim or lawsuit, up to the policy limit, as far as liability goes. The confusing part was that specifics were covered in the section about coverage for the boat itself (which I don't have). But the second part of the policy that talks about liability is very generic and doesn't talk about specifics like wreck removal or environmental remediation. The agent says that the page about exemptions doesn't say anything about wreck removal or cleanup so that means that it's covered.

geneseo1911, is that State Farm that is providing coverage for your boat? By the way, I've spent quite a bit of time at the power plant near Clinton.

 

[shrew]

Re: Boat insurance for environmental cleanup?

Your best bet is to call your agent and specifically ask. The agent SHOULD call the underwriter for the company you're insured through and the underwriter will be able to clarify. The agent isn't responsible for knowing EVERYTHING about every policy with all companies. They should be responsible for understanding basic insurance concepts and addressing common questions. unique, or odd covereage questions should be verified with the underwriter by the agent if the agent is unsure. That is ALSO what the agent is there for.

Also keep in mind, if you convey that you want to ensure that you are covered for "sinking and environmental cleanup" and are are told you are, then a claim is denied, you can file under an "Errors and Omissions" policy which is carried by teh agent and the insurance company. This allows their errors and omissions policy to cover deficiencies in your policy should be under the impression you were covered when you were not. The key here is the agent or underwriter would have to have made a mistake and improperly written the policy to begin with. When you call, make sure to request that the RFI (Request for Information) be notated in your file. This will give you grounds if you are later denied coverage.

BTW- the BEST answer for insurance questions ir your agent, not a bunch of weekend boaters.

 

[PiratePast40]

Re: Boat insurance for environmental cleanup?

^^^^^ Wow - didn't expect that. If I hadn't asked the question, I would have not learned about Boat US spelling out, line by line, what's covered. If you look at my posts, I did call my agent and he was very nebulous with his answer. I then called the State Farm customer service number and they kept running me around to different people and the response was pretty much the same - they won't know if something is covered until you file a claim.

I asked here because there are boaters with insurance with different companies, and these people would have seen things that I had not. My belief is that my insurance agent would most likely, only tell me only what he knows about the products he sells and not what is seen in policies from different companies.

Even your responses concerning errors and omissions and taking notes when talking to an agent were helpful. And yes, the agent finally called both underwriting and claims to get the correct and complete answer.

I'll just respectfully disagree with you and hold on to my opinion that it's OK to ask boaters about boat related questions.

 

[Home Cookin']

Re: Boat insurance for environmental cleanup?

Re: "BTW- the BEST answer for insurance questions ir your agent, not a bunch of weekend boaters."

that may be the better place to ask, but as we learned from the first post, it's not always correct. The only thing that matters is what your policy says, nto what someone thinks it says (ie your own policy, as signed by the company, not an old one, not a sample and for cod's sake not someone else's.)

Weekend boaters can't give you reliable information but their answers can tell you what to look for (or look out for). And who knows whether someone here is an insurance agent, claims processor, underwriter or attorney with experience.

One thing for certain, this is the worst place for legal advice. Like the one about suing the agent's E&O policy if he tells you something incorrect. That's just laughable.

Here's the bottom line: if your boat sinks in its slip for ANY reason, you are responsible for removing it and cleaning up any damage. If someone else causes it to sink, you are still responsible, even though you might be able to make him pay you back. You have insurance coverage for your responsibility ONLY IF you have a contract with an insurance company to cover it. What when how if and how much is in the contract, and only in the contract. The contract will say if you are covered for every event or only certain ones. Some might exclude a sinking caused by poor maintenance or even mechanical failure. Others might not. Some might cover the damage to the boat, too; some might not. Assumptions and other people's contracts and experiences don't change that; neither does a statement by any person connected with insurance, unless that statement comes in a form of equal (legal) dignity as the insurance contract. Read the integration clause.

 

[geneseo1911]

Re: Boat insurance for environmental cleanup?

geneseo1911, is that State Farm that is providing coverage for your boat? By the way, I've spent quite a bit of time at the power plant near Clinton.

Yes, my old boat, a '69 14' Larson w/ a '69 Evinrude Big Twin and a 2008 "homemade" trailer , was covered by State Farm. I forgot that I let the coverage lapse this spring because we don't use it anymore. I need to get it sold. The agent never gave the age a second thought. It wasn't insured for much, I really only had the insurance for the liability of hurting someone else or if it sinks. I looked at the policy, and wreck removal is specifically listed as covered. Environmental cleanup is not specifically listed, but it is also not excluded anywhere, and my understanding is that it is included in the wreck removal.

The negligence part, as I understand it, is if you knowingly fail to do something to protect the boat/environment. For example if you know your boat leaks a quart of oil into the bilge each outing, but you just top off the motor and run the bilge pump at the end of each trip. Of course then you get into the question of who has the burden of proof.

So you must be one of the folks that keeps our big, blue lake heater operating? I'm always amazed at the amount of energy that thing must produce that the WASTE energy can heat THAT much water.

 

[ezmobee]

Re: Boat insurance for environmental cleanup?

I then called the State Farm customer service number and they kept running me around to different people and the response was pretty much the same - they won't know if something is covered until you file a claim.

I would take all my business from an insurance company that gave me that kind of answer.

 

[lncoop]

Re: Boat insurance for environmental cleanup?

I would take all my business from an insurance company that gave me that kind of answer.

I was thinking the same thing. I don't expect my agent to know everything, but I have yet to stump him with a question regarding my homeowner, auto, life or boat coverage. However, at his insistence I have called Foremost (Farmer's boat insurance subsidiary) when he wasn't 110% sure of an answer he provided. He has yet to be wrong about anything. I think if I were you I'd at least do some shopping. I don't like the answers (or lack thereof) you've been given, Pirate.

 

[Home Cookin']

Re: Boat insurance for environmental cleanup?

geneseo, although it's interesting for discussion, you shouldn't be concerned about salvage recovery cost for a 14' boat. Hook up a line and just yoke it out of there. But if they throw it in there, great. As for clean-up, what is your exposure? what's left in the 6 gallon tank?

And have you checked your homeowner's policy to see if a 14' boat (and I assume<50 hp) is already covered? read yours, but for many policies, boats are excluded, but anything under x feet and y HP is not a boat, and therefore covered. Read your policy. Of course, you don't need casualty (property loss) for a boat that old.

Also your understanding of negligence is incorrect. What you describe would be considered "intentional" and liability for it probably not covered. Negligence would be if you did NOT know, or have reason to know, that your oil was leaking and being pumped overboard. Think "accidental."

 

[wilyesteve]

Re: Boat insurance for environmental cleanup?

I think my BOATUS policy has 800k in fuel spill liability.

When I talked to my State Farm agent, who insures my house and cars, the rate was way higher, plus she didn't know anything about a fuel spill policy provision. And BOATUS was much cheaper.

+1 for BoatUS

 

[lakegeorge]

Re: Boat insurance for environmental cleanup?

My Boat US policy has an $800k coverage also for spills.