Wednesday, 05 May 2010 17:25
In an age when every penny counts, Stuart Field thinks spending good time and money on the right insurance deal is even more vital than ever . . .
Insurance for boats, unlike cars or motorbikes, is not yet a legal requirement in the UK. However there are ever increasing circumstances where proof of at least third party insurance is required before you can launch. Many UK marinas, harbours, waterways authorities and slipway operators already make such demands, while British Waterways, and more recently the Boards Authority, make insurance a requirement to boaters wishing to use their waters. Many European countries can, and do, frequently demand to see your insurance papers if towing a boat in their jurisdiction.
With increasing financial pressures affecting the vast majority of the population, most families are naturally on the look out to make savings - so it’s not surprising that insurance on something that’s not used every day seems a good place to make cuts. But in today’s world of compensation litigation, and the very high cost of boats and engines, is this really a risk you’re prepared to take?
In this feature we aim to show you that by carefully comparing insurance costs you may well be able to save money and still remain protected by insurance. But, before we do that, we are going to answer a few pertinent insurance questions with the help of Craftinsure.
WHEN SHOULD I GET MY BOAT INSURED?
ou should get insured the moment you buy your boat, especially if you intend to tow it home. In fact you can arrange insurance up to 30 days before you buy to save a last minute panic. Bear in mind that insurance policies are not transferable so don’t rely on the previous owner’s cover to get you home. Importantly, most vehicle insurers automatically cover boats that are being towed on the road but there may be limits, especially on the length, so please check before you tow your boat for the first time.
Before you set off for home with your new purchase make sure the trailer is up to the task. Dropping your boat, or causing damage to another vehicle, is not a good way to start.
What should I be looking for when buying insurance?
When arranging insurance or seeking a quotation, make sure any declarations you make are accurate, as they will form the basis of a binding legal contract between yourself and the insurer. The insurer’s governing body, the Financial Services Agency (FSA), says that you are entitled to see a ‘Summary of Cover’ before paying for a policy, or agreeing to a quote on line. You are also entitled to see a sample policy. Always assure yourself that the terms and details of cover are what you need before parting with any cash.
How can I make sure insurers are genuine, and who can help if I get into a dispute?
When choosing an insurer or broker, check that they are fully authorised by the FSA. If in doubt, visit the FSA website or phone the body’s office. It’s also a great help if an insurer is a member of the British Marine Federation, which should mean they are marine specialists and understand boats. To minimise any insurance difficulties also check that your chosen insurer is a member of the Financial Ombudsman Scheme, which provides you with a free service in the event of a dispute. Any Ombudsman’s decisions against an insurer are legally binding.
How much should I insure my boat for?
You should obviously seek to insure your craft for an appropriate sum. A guideline is to calculate what it would cost to replace the boat with one of similar type, age and condition, equipped to a similar standard. But please bear in mind that, while most policies provide cover on an ‘Agreed Value’ basis, outboards can only be insured for their current market value and they can depreciate very quickly.
It’s quite difficult to place a value on a boat, especially in today’s economic climate. If you’ve just bought the boat, its purchase price will be a good guide. You can also look at similar boats for sale in Boat Mart or, in the case of an unusual or higher value craft, seek an opinion from a surveyor or reputable boatyard.
Craftinsure’s top insurance tips
- Use the net and get quotes on line
- Check the insurer is authorised by the FSA
- Consider taking a higher excess to reduce premiums
- Check that you aren’t paying for wider cover than you need
- Review your sum insured against current market values
- Conduct thorough and regular checks to avoid preventable claims
- Remove valuables from the boat when unattended and fit good locks
Do not forget . . .
Personal injury claims can amount to millions (enough to bankrupt an uninsured family for life) so whatever else you do, ensure that your boat is covered for third party liability with a limit of at least £3million for any one event. And do please check with your insurers that ‘Removal of Wreck’ cover is included. Even a small family cruiser or a sports boat that sinks in a harbour or on a mooring can cost a lot to recover, regardless of its intrinsic value.
How can I minimise the cost of boat insurance?
- As in many other cases, the Internet has made it simple to compare prices but always check that an insurer meets the guidelines already outlined.
- As with car and home insurance, look for insurers that are not listed on major comparison web sites. You may well benefit from them not paying the comparison site a commission.
- Consider an online specialist boat insurer. They can usually offer significant savings by cutting down on paperwork and offer you fast quotations and simple online payments.
- Shop around before your policy is due for renewal. Once you have renewed your policy, the administration charges applied for cancellation might well exceed any saving you could achieve by moving to another insurer.
- The most obvious way to save money, other than limiting cover to ‘Third Party Only’, is to increase the excess you are prepared to pay in the event of a claim. For example, Craftinsure’s online quote system provides quotation options with a standard excess as well as an alternative at double the standard amount, saving up to 20 per cent on the annual premium.
- Keep it simple. Always tailor your insurance to meet your needs and ask yourself four serious questions:
1 - Is the cruising area realistic? Why pay insurance to cruise the Azores if you’re not likely to leave the Solent, the Wash or the Mersey. You can always extend cover if you decide to go further a field.
2 - Are you really going to race? If you’ve got a cruising policy do you really need it to include racing which can add a chunk to your premium. Again you can always take out cover for the odd special event.
3 - Do you need to keep your boat on a mooring? Keeping you craft ashore or in a marina can save you 15 per cent on your premium. Similarly keeping a valuable powerboat in a dry stack can save a chunk of cash.
4 - Would it help to spread the load? Many insurers offer the facility to pay by monthly instalments for a small fee. Craftinsure offers this service for free.
Will I need a survey?
If you’re considering comprehensive cover you may need to have a professional survey done. It can depend on the age and size of your boat and requirements can vary but, in line with most insurers, Craftinsure require owners to have a recent survey for boats over 20 years old, but only if the boat is over 23 feet in length. Surveys will need to be provided by a qualified marine surveyor, most likely a member of the YDSA (Yacht Designers and Surveyors Association) or RINA (Royal Institute of Naval Architects). Third Party Only insurance, or cover on new or smaller craft, can usually be obtained without the need for a survey as long as you can provide full purchase documents.
What about Third Party?
If you feel that your boat is just not worth insuring, and don’t require insurance where you usually launch, do bear in mind the potentially financially crippling risk of third party claims. For instance, even if you have an old sports boat or a sedate plodding launch, just imagine the damage it could do to a nearby Sunseeker or a prestige cruising yacht. And when you’re off the water (and indeed off the public roads), the risks remain equally high. Backing your boat into a Bentley in a boatyard or running over an unsuspecting spectator’s foot while reversing could cost you a bomb. But the greatest potential risk is accidentally injuring someone in the water, hitting someone on another boat, or causing injury to a crewmember. For events like this, insurance is much more than just a luxury expense.
The claims game
A claim on your boat’s insurance is likely to hit you in the wallet, so follow the following advice and help minimise your own risks:Always check your boat over and make sure she’s well prepared for the season. Simple things like leaking skin fittings can lead to a sinking and a corroded jubilee clip can cause an engine to fail.
If your boat’s left afloat, don’t rely on auto bilge pumps. Batteries can fail and pumps can block, leading to yet another sinking claim. And finally, try to make life difficult for thieves by stepping up your security measures.
In recent months, insurers have seen another increase in theft claims with outboards and PWs heading the list. Remarkably, the high value of metals has also led to a spate of thefts of metal fitments, including shafts, props and brass vents from craft all over the country. If thieves can pinch a couple of hundred drain covers in a Coventry street, stealing bits from a boat in a remote boatyard is a doddle.
Outboards are equally at risk so ensure they are kept in a secure store or fitted with locks. Keep trailers secure with wheel clamps and lock the hitch when not on tow.
Make sure you keep a record of the serial numbers of all high-value items. You can also make a thief’s life more difficult by using a security marking system such as Smartwater and by registering your valuables with your local crime prevention officer.
FURTHER INFO
For advice or an immediate quotation:
08452 607888
www.craftinsure.com
To find a nearby YDSA marine surveyor:
01730 710425
www.ybdsa.co.uk/surveyor.asp
To seek advice from the FSA:
03005 005000
www.fsa.gov.uk
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