Main Content

Blog Top

Smooth Sailing: Boat Safety & Insurance

AddToAny buttons

Smooth Sailing: Boat Safety & Insurance


According to the U.S. Coast Guard, there are almost 12 million registered recreational water vessels. Though accidents are relatively rare considering there are so many boats on the nation’s waterways, they’re still a serious risk. The Coast Guard recorded 4,463 recreational boating accidents in 2016, resulting in 701 deaths, 2,903 injuries, and approximately $49 million in property damage.1

Before you hit the water, make sure you have appropriate insurance coverage and follow safe boating practices. Here are some tips to consider:

Before You Leave the Dock

  • Check weather forecasts before heading out. Let someone know where you’re going and when you expect to return
  • Check your engine, fuel, and electrical and steering systems; be sure to check for exhaust-system leaks
  • Carry one or more fire extinguishers appropriate for the size and type of boat. Keep them accessible and in good condition for immediate use
  • Equip the vessel with required navigation lights and a whistle, horn, or bell
  • Consider additional safety devices, such as a paddle or oars, a first-aid kit, a supply of fresh water, a flashlight, flares, a radio, a tool kit, and spare parts

Out on the Water

  • Make sure the skipper and passengers wear U.S. Coast Guard-approved life jackets. In 2016, 83% of drowning victims in boating accidents were not wearing a life jacket2
  • Know standard distress signals and obey marine traffic laws
  • Be alert for other watercraft, swimmers, floating debris, and shallow waters
  • Don’t overload the vessel, and distribute the loan evenly
  • Don’t stand up or shift weight suddenly in a small boat
  • Don’t permit riding on the bow, seatbacks, or gunwales
  • Never operate a boat while under the influence of alcohol or drugs. In 2016, alcohol use was the leading factor in fatal boating accidents3

The U.S. Coast Guard Auxiliary offers free advice and boating safety courses. If requested, they’ll conduct a free Vessel Safety Check (VSC) on your boat. Boats meeting safety standards are awarded a VSC decal that is recognized by law enforcement and safety organizations. Many insurance companies offer discounts for boats that undergo a VSC annually.4

Insuring Your Boat

Homeowners or renters insurance policies may provide limited property damage coverage for small watercraft such as canoes, small sailboats, and powerboats with small motors (under 25 horsepower). Liability coverage is generally not included; however, you may be able to add it as an endorsement.

Larger and more powerful boats (and personal watercraft) should be covered under a separate boat insurance policy. State requirements vary, but most lenders will ask for proof of insurance. Keep in mind your homeowners policy may not cover your boat even if it’s parked in the garage.

There are two types of coverage for physical loss or damage to the boat and permanently attached equipment:

Actual cash value – Pays for replacement costs less depreciation at the time of the loss. In the event of a total loss, market value is based on used-boat pricing guides and similar sources. Partial losses are paid based on the total cost of repairs minus a percentage for depreciation, and the policy deductible also applies. An actual cash value policy is typically more economical, but coverage is narrower.

Agreed amount value – Coverage is based on the value of your vessel as agreed upon by you and your insurer. In the event of a total loss, you would typically receive the agreed value minus the policy deductible. In a partial loss, these policies may replace structural items without any deduction for depreciation, after the policy deductible. An agreed value policy typically costs more than an actual cash value policy but offers broader coverage.

Watercraft policies generally exclude certain types of damage, such as normal wear and tear, defective machinery, and damage caused by mold, insects, animals, or zebra mussels.

  • Boat insurance usually also covers the following:
  • Bodily injury caused to another person
  • Property damage caused to someone else’s property, such as another boat or a dock
  • Guest passenger liability for legal expenses incurred by someone using the boat with the owner’s permission
  • Medical payments for injuries to passengers
  • Theft

Ask your insurance representative about coverage for special equipment kept on the boat, such as fishing gear and water skis. Also ask whether your insurance covers towing.

Spending time on your boat or other watercraft should be a relaxing break from the hustle of everyday life. Take a few moments to review your coverage and be sure you have the protection you may need.

This article was provided by our Credit-Union-owned insurance agency, Member Advantage Insurance Services. If you need help with your insurance needs, we encourage you to reach out to them free of charge at 800.866.6474 x2368 or