Does Boat Insurance Policy Covers Those Who Borrow My Boat?

No doubt regulations about boat insurance are applied differently in various states; however, the way policies are is almost uniform in all over the country. A standard policy will not cover your friends or extended family members if they borrow your boat.

Though, some similarities exist between boat insurance and auto insurance, it is significantly different from the nature of maritime law as well as the large variety boats sailing on the water. Experienced boaters should acknowledge the importance of hiring a well-experienced, highly qualified insurance underwriter who could help them regarding boat insurance from This write-up aims at letting you know what boat insurance generally covers and which coverage option you need to choose and purchase for your boat.

Boat Insurance: Standard Liability Coverage

When you consider carrying insurance on your boat, you are recommended to take a start with a basic liability policy. In terms of coverage, such policies range between $100,000 and $1,000,000. What is covered by them include physical damage to your boat, passengers, and specific personal items you bring on board, as well as damage caused to another boat, pier, dock, etc.  Buying a minimum liability policy is always in your best interest even though it is not required by law.

In addition to the above-mentioned coverage, liability policies can also cover damages inflicted upon your boat and personal property by fire, theft or bad weather. However, you will have to pay more premium in accordance with the value of your boat, if you want to have these damages covered by the policy.

Remember a standard liability policy does not cover any damage or injury caused by someone who happens to borrow your vessel. It means if a friend of yours asks you for your boat for a day of fishing, you are actually taking the risk of any damage he might cause to your boat. At the end, you will be liable in the court if such accident takes place.

Boat Insurance: Umbrella Coverage

Umbrella policy offers the best coverage ever by insuring anyone you might lend your boat to. Thus umbrella policy provides extra coverage to fill in the gaps left by standard liability policies. The most salient feature of this policy is that it does not confine the coverage to only you and your boat.

Most people are unaware of the fact that when it comes to lending vehicles to friends, the auto insurance policies are the same way as boat insurance policy. It is more than a common practice that auto insurance does not cover any non-family member borrowing your car; one the other hand, family members who borrow your car to serve you someway are duly insured.

Thus an umbrella policy, as the name itself suggests, will insure both the boat and the car from liability caused by any friend or extended-family members who are going to borrow the vehicles. This policy can also decide on including ATVs, boat trailers as well as recreational vehicles. Such umbrella insurance policy suits those who own multiple vehicles.

Boat Insurance: The Cost of Umbrella Coverage

Like other insurance products, the cost of umbrella insurance has increased significantly. However, it is still less expensive when compared with other types of added insurance policies and the overall costs of boat insurance. In some states, the minimum required sum for the umbrella insurance policy is not less than $5 million. Such policies can cost as high as $500 million for those who own an exceptionally high value vessels.

Assuming the minimum cost of umbrella insurance policy as $5 million, you should expect paying, in general, about 8% more than your current liability coverage. So if you are paying $5000 annually for your current policy that covers two cars, a boat and an ATV, buying another $5 million worth of umbrella coverage will mean another $400 will be raised to your premium. Evidently, the cost becomes higher in accordance with the increase in the coverage limits.

When covering your boat with an umbrella policy, remember the following two factors:

  • Number of items you want to be insured
  • The risk-claim you pose to the policy underwriter

As far as the former is concerned, your umbrella insurance rate will be better if you carry all policies with the same insurer. Therefore, you had better carry your home, auto, and boat policies with the same insurance company. This way, all the three vehicles will be covered by an umbrella policy at a reduced premium.

As of the latter, the risk you pose to the insurer is also a significant factor to determine the cost and premiums of your umbrella coverage. Your driving record, credit history, and past claims all convey to the insurance company how careful, or careless you are. So obviously if you pose a greater risk, expect your premium to be higher accordingly.