Insuring a Boat, Mike Smith

 

“Why boat insurance prices today are the lowest they’ve been in 40 years”

Highlights from this Segment

– Why maritime law is different than normal torque law

–  Four coverages marinas need to cover themselves

–  Why boaters are being asked to have marinas on their policy

–   Difference between hull coverage and liability 

(transcript for this segment)  

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Here’s what you’ll discover in this presentation…

  • The #1 mistake boaters make when choosing an insurance policy
  • An insider secret to getting insurance for your wooden boat
  • The major differences between actual cash value and agreed value
  • The most important section you must read in your insurance policy
  • The quickest way to lose money on an insurance claim
  • The #1 reason why marinas, yacht clubs and boat yards require insurance
  • The easiest step to take before buying boat insurance
  • The truth about  the cost of boat insurance
  • The monster do’s and don’ts about coverage in your insurance policy
  • By not using this type of surveyor for your boat, you are limiting your choices of insurance

About Mike Smith

Mike Smith is a Senior Vice-President at Global Marine Insurance Agency, headquartered in Traverse City, Michigan. He began work in the insurance industry in 1975. He is also a board member of the National Marine Bankers Association. Mike designed a special endorsement for bare boat charter fleets that has been adopted by many insurance companies.

Transcription

Robin: What kind of insurance are marinas, boat yards and yacht clubs requiring? And, Why the difference?

Mike: Well, again, maritime law is a lot different than normal torque law and marinas and boat dealers have different coverage needs than the normal business. They have an open lot with about $3million of boats sitting there. They operate on the water so they PNI, they need Jones Act coverage, they might need USLNH, they need workers comp, which is designed for the maritime exposures and within the insurance industry there are few marine specialists that know what they’re doing. But, it’s not a huge industry. I mean, compared to the rest of the insurance world, if you will. So, these unique coverages need to be insured by a company that knows and understands the risks and by an agent that really knows and understands the risks. And, as I think you mentioned earlier, I’ve been doing charter fleets for 30 years and there’s a very unique coverage that they need which covers everybody very well, but most insurance companies say “oh no, we don’t want the risk, we don’t understand the risk and no thank you” which is fine. That’s a business decision that they make. But, these marine people need these coverages. It’s a very competitive market right now. Because, these marine specialist companies, the boating industry is in a decline, and so everybody is fighting for market share in a declining market. We put ourselves out as an expert in that area and travel all over the country and help marine – commercial marine businesses risk manage their business so that they don’t have losses and companies that don’t have losses have lower insurance costs at the end of the day which increases their profits. And, that’s what we like to help them do.

Robin: Ok. So when a boater shows up at a marina or they call a marina or boat yard to say that they’re coming in maybe as a transient or to get a slip for the season. Some of the marinas are requiring $100,000 liability coverage,

Mike: It’s probably more like $300,000, Robin

Robin: Well, some are actually doing $100,000 and others are doing $300,000. There is a difference.

Mike: Ok.

Robin: I’ve actually surveyed like 300 marinas

Mike: Really?  Ok

Robin: yeah!

Mike: I have not seen anybody just ask for 100,000. I thought it was all 300 and up.

Robin: It may be now, but as of last year

Mike: No, You’re probably right on – I don’t see those requests for certificates very much, so.

Robin: So, some of the boaters, before they didn’t have it, but they get upset because the marinas are asking to see that coverage

Mike: Well, the marinas are coming from a perspective of risk management. If you pull into a marina and

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 Posted by at 3:26 pm

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