If your yacht is over 26 feet in length, it is a requirement that you have current yacht insurance policy. Insurance for yachts less than 26 feet in length is technically known as boat insurance, but for larger yachts, individual insurance policies are needed due to the higher values ​​and variety of requirements. However, the general principles of yacht insurance and types of boat insurance are similar.

There are two key reasons to have yacht insurance. The first is to protect your financial investment against damage, theft, fire or any other event that may cause the total or partial loss of your precious vessel. Second, if another person or yacht is injured or damaged by your yacht, your yacht insurer will pay financial compensation.

What are the key elements to look at when insuring your yacht?

Full Coverage – There are three main areas of insurance for your yacht; physical damage, for example, collision, fire, and vandalism or theft. Some policies allow you to make a selection between them. If you choose not to carry one or more of these types of insurance, then you are assuming all risk in the unfortunate event that such an event occurs. That too can cause problems if you have damage insurance, but the actual damage is a combination of collision and fire. So, on reflection, the vast majority of yacht owners are reasonably insured against all risks through a comprehensive yacht insurance policy.

Home Mooring Location – Many policies ask where your boat is normally moored. It is vital to be truthful and accurate in this regard when applying for marine vessel insurance for your yacht. You can keep your yacht moored at a dock or marina, or you can spend your time in a tidal mooring, but either way you need to be honest in order to be adequately covered by your boat insurance in the event of an accident.

Third Party Liability – In the unfortunate event that your yacht is damaged, stolen or burned to the ground, you always have the option to do nothing and simply accept your loss. However, if you or your yacht injure another person or cause damage to their property, you will not have that option. You must reach into your own pocket to make restitution. This is where the third party portion of your yacht insurance policy will come into effect so you don’t have to pay personally. Although there is no general requirement for insurance coverage, there are many locations where it is required; An example is most docks, marinas, and ports where a minimum insurance is required, perhaps $2 million.

Coverage by location – Make sure you understand where your insurance policy provides coverage for your yacht. Most yacht insurance companies are quite generous with their definition of sailing area, but be sure to clearly read and understand any limitations. The range can always be increased if necessary, but some additional premiums may be required. Location is also an important consideration with the non-boating portion of your insurance. An example is when the yacht is stored dockside, either over the winter or for repairs and maintenance. Another example is if your yacht must be transported by road.

Insurance Value – When determining the value of your yacht for marine insurance purposes, there are two main options. The first is by an agreed figure written in the policy document. The second is by valuation. In the latter case, the value is determined by a maritime surveyor after the loss of a yacht. Having a pre-agreed figure in your policy provides greater certainty in the event of a claim; A second advantage is that because the figure is agreed in advance, a settlement can be executed more quickly.

Waiting Period – It is a ‘feature’ of some yacht insurance that you do not sail at certain times of the year in some places to avoid extreme weather and in others to avoid the winter months. Examine your policy closely to verify any waiting period requirements.

How easy is it to make a claim? – A yacht insurance policy is only as good as your ability to make claims in the event of an incident. Talk to fellow boaters and boaters at your dock, marina, or yacht club. Use your experiences to check out which insurance companies and brokers are best to use—or avoid—so you’ll find that filing a claim is easy if ever necessary.