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Boat Insurance FAQ

Boat insurance is not required by law in Ontario. However, despite efforts to mitigate risk, there are many reasons to have an insurance policy. For example, if you store your boat at a marina, you may be required to show proof of insurance. If you are financing your vessel, your lender may require boat insurance before approving your loan. Marine insurance will ensure that you are covered in unforeseen circumstances, including collisions causing injuries to people or their property at the fault of your boat. It will also cover damages due to perils like fire, theft, vermin and vandalism so that you don’t have to pay out of pocket when issues arise. So while you don’t need boat insurance in Ontario, having it is a good idea.

Boat insurance covers your watercraft and helps reimburse you in case of damage or liability. Most boat insurance claims come from damage to the vessel caused by objects like rocks, logs, and shoals. You can also submit claims for damages from common perils like fire, theft, vandalism, and collisions with other boats.

The cost of boat insurance is determined based on various potential risks and can depend on many different factors, including:

  • The type of watercraft you have: Smaller boats may cost less than larger ones and the maximum speed has bearing on your premiums. Additionally, if you have a jet engine, this can impact your insurance.
  • The value of your vessel: More expensive yachts, for example, will cost more to insure than a small dinghy.
  • Where you use your boat: Small lakes tend to be less risky than sailing on open seas. Geographical locations that pose more risks may also increase premiums.

Your previous claims: Your premiums may increase if you have made several claims in the past. These claims include earlier ones on your boat and those made for your car with other insurance companies.

Your watercraft is covered under most standard home insurance policies once you inform your broker. This coverage includes damage and liability. However, your boat’s coverage only applies if it meets certain conditions related to value, size, horsepower, speed, and type of boat. For example, if your vessel is more expensive in value or more significant in size, it may not meet the requirements for coverage. It is often better to have separate marine insurance since this coverage is more comprehensive and won’t affect your home and auto policy rates if you make a claim with your boat.

Yes, boat insurance covers theft. However, some companies have theft restrictions or lock warranties that specify conditions that must be met for theft coverage to apply. These conditions can include signs of forced entry as a requirement for coverage or locking your boat in a specific way to prevent theft. Check with your insurer to see if your policy has any theft restrictions.

Yes, boat insurance typically covers sinking caused by common issues like storms. Often, insurers cover repairs for sunken boats, but it is uncommon for a boat to be written off. Your policy may also reimburse you for salvage, environmental cleanup, and removal costs. It is important to note that there can be some policy exclusions. For example, your insurer may not cover your claim if your boat goes under due to negligence or failure to perform maintenance. Additionally, if your policy only covers specific locations, you may not be covered if your vessel sinks outside the stated navigation limits.

Your past claims can impact the current premium of your boat insurance policy. If you make a claim for the first time, you may lose your claims-free discount, which will increase your premiums. With subsequent claims, there can be more penalties, and eventually, insurers may choose not to cover you.

Boat lifts are typically not covered under your boat insurance policy, the same way your auto insurance does not cover your garage. Check with your insurer to see if you can add it to your existing policy or if you can get a quote for a separate policy.

No, you cannot insure a boat that’s not under your name. If you wish to do so, you need to transfer the title of the watercraft to your name before you can insure it.

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