A Common Thread in Boat Insurance?

[Alaskan Sea-Duction]

OK so at the Seattle Boat show I heard a common theme amoung boat insurers. They will no longer insure live aboards? Is this now common with carriers? Why? I was told becuase of the current situation with live aboards living on poorly mainatined boats.

Insight and/or comments?

Pete?

 

[Pau Hana]

Sorry I missed you at the show!

I haven't had any trouble getting liveaboards coverage. There are a number of markets that dover liveaboards, and far more that will not.

 

[MartySchwartz]

Sorry I missed you at the show!

I haven't had any trouble getting liveaboards coverage. There are a number of markets that dover liveaboards, and far more that will not.

Hey Pete, we stopped by yer booth on Saturday and they said you were out goofing off. Actually they just said you had been there Friday. Good to hear there are still intelligent insurers out there.

Marty..................

 

[hmason]

Is there a difference between a live aboard and a full time cruiser?

 

[markpierce]

When the vessel is moving through the water, a live-aboard is a cruiser.

 

[MYTraveler]

I doubt it. The only thing Lloyds won't insure is a moral hazard, and even then . . .

 

[Moonfish]

Sorry I missed you at the show!

I haven't had any trouble getting liveaboards coverage. There are a number of markets that dover liveaboards, and far more that will not.

Pete - what is your booth number?

 

[BandB]

Oh agents love to start those rumors as if universal when it's only their company. Back to basics. A. People live aboard boats all around. B. Marinas require proof of Insurance. C. Therefore, if A and B are true then Insurers must insure liveaboards.

That's like hearing you can't get insurance below a certain area of the east coast or can't get it for hurricane season. Just the greatest concentration of the boats in the country and they don't all disappear half the year.

 

[Pau Hana]

Is there a difference between a live aboard and a full time cruiser?

A true liveaboard has cut ties to ownership of any real estate (owned or rented). There's a lot of gray area in that definition....

Pete - what is your booth number?

We are Booth 919 in the East Hall of Centurylink.

Oh agents love to start those rumors as if universal when it's only their company. Back to basics. A. People live aboard boats all around. B. Marinas require proof of Insurance. C. Therefore, if A and B are true then Insurers must insure liveaboards.

That's like hearing you can't get insurance below a certain area of the east coast or can't get it for hurricane season. Just the greatest concentration of the boats in the country and they don't all disappear half the year.

Well stated.

 

[BandB]

Insurance is a very complex undertaking and one filled with danger.

The above is not an exaggeration but may be understatement.

Policies are complex legal contracts that most people never read completely and, as a result, don't know what is in their policy. Calling two companies and just getting dollar quotes tells you nothing. The differences in the terms can make the more expensive one the true bargain or, it may have more holes in it.

This isn't just true of boat insurance but all insurance. However, other areas of the industry are far closer to standardized than boating, partly due to state regulation of some minimum requirements.

You find out the true coverage when you have a claim. And even then you may find that two identical policies provide far different coverage as one insurer is quick to pay what is owed and the other one is slow and contentious.

Sometimes it's almost a shell game. Have a list of specific questions regarding coverage. If you're told salvage is covered, find out exactly how much and under what conditions. Policies are filled with exclusions.

Insurance "salesmen", and I intentionally used that word rather than agents to classify the bad vs. the good, will tell you what others do and don't offer, how the industry or market has changed and whatever else is to their benefit at the moment. "Agents" or "Brokers" will assist you in finding what is best for you.

And that brings me to my major points. Find a professional you can trust. Work off recommendations from others. Build a relationship. Have them shop the market to meet your needs. Find someone not tied to just one carrier. Know your policy. Find someone who will sit and go through it in detail with you. Get someone else to review it for you if you feel the need.

And all those things that are impossible. Well, we live and keep boats in South Florida. We have no seasonal restrictions. We have no area restrictions. We have no named storm restrictions. The only places in the world that we have restrictions are a very few areas of high piracy and danger and war and they would require a rider which is available at a cost. I was more than willing to raise our deductible, but at the point we were it made no difference so didn't.

Find insurance professionals to deal with rather than just phone sales people. Large businesses often go an entirely different route in pay for service but no commissions. Now that's not a choice for most of us. We may not like lawyers, accountants or insurance agents in some ways, but we darn sure better have the best we can find. If you do, you might just find yourself sleeping a little better at night.

And back to what the OP was told. Think about it. Is there any logic? So you just found out all you needed to about whomever you were talking to. Either (1) they don't know what they're talking about or (2) they're lying to you.

 

[Pau Hana]

Insurance is a very complex undertaking and one filled with danger.

The above is not an exaggeration but may be understatement.

Policies are complex legal contracts that most people never read completely and, as a result, don't know what is in their policy. Calling two companies and just getting dollar quotes tells you nothing. The differences in the terms can make the more expensive one the true bargain or, it may have more holes in it.

This isn't just true of boat insurance but all insurance. However, other areas of the industry are far closer to standardized than boating, partly due to state regulation of some minimum requirements.

You find out the true coverage when you have a claim. And even then you may find that two identical policies provide far different coverage as one insurer is quick to pay what is owed and the other one is slow and contentious.

Sometimes it's almost a shell game. Have a list of specific questions regarding coverage. If you're told salvage is covered, find out exactly how much and under what conditions. Policies are filled with exclusions.

Insurance "salesmen", and I intentionally used that word rather than agents to classify the bad vs. the good, will tell you what others do and don't offer, how the industry or market has changed and whatever else is to their benefit at the moment. "Agents" or "Brokers" will assist you in finding what is best for you.

And that brings me to my major points. Find a professional you can trust. Work off recommendations from others. Build a relationship. Have them shop the market to meet your needs. Find someone not tied to just one carrier. Know your policy. Find someone who will sit and go through it in detail with you. Get someone else to review it for you if you feel the need.

And all those things that are impossible. Well, we live and keep boats in South Florida. We have no seasonal restrictions. We have no area restrictions. We have no named storm restrictions. The only places in the world that we have restrictions are a very few areas of high piracy and danger and war and they would require a rider which is available at a cost. I was more than willing to raise our deductible, but at the point we were it made no difference so didn't.

Find insurance professionals to deal with rather than just phone sales people. Large businesses often go an entirely different route in pay for service but no commissions. Now that's not a choice for most of us. We may not like lawyers, accountants or insurance agents in some ways, but we darn sure better have the best we can find. If you do, you might just find yourself sleeping a little better at night.

And back to what the OP was told. Think about it. Is there any logic? So you just found out all you needed to about whomever you were talking to. Either (1) they don't know what they're talking about or (2) they're lying to you.

^^^

Sounds like you took my class, or attended one of my seminars.

 

[Alaskan Sea-Duction]

Well a friend of mine, who is a live aboard approced a few insurance companies at the boat show, I don't think he stopped by yours Pete, and was told the same thing, they no longer cover live aboards to include the company I am with! So now I cruise full time.

 

[Pau Hana]

Have him reach out to me, and we'll chat.

 

[Bilgewater]

So if you don't own or rent a piece of dirt somewhere, you are a live aboard/full time cruiser?

 

[Pau Hana]

So if you don't own or rent a piece of dirt somewhere, you are a live aboard/full time cruiser?

Depends on the carrier, but essentially- yes.

If you're a liveaboard, you want to be upfront about it. Some insuring companies will not cover liveaboards, and will retroactively cancel to policy inception if the discover that a liveaboard situation is present. Other companies will just note the policy as a liveaboard and take no further action.

A few carriers offer a "liveaboard endorsement" that extends the liability, medical, and personal effects coverages to worldwide, the same as a traditional homeowner's policy. Otherwise, the above coverages on a vessel policy are limited to aboard the vessel, embarkation and disembarkation only.

 

[ancora]

In our yacht club marina, the live-aboards are also slip-huggers who have not moved their boat in years, except to have the bottom painted. Isn't a boat safer sittin' in a slip than underway?

 

[BandB]

If you're a liveaboard, you want to be upfront about it. Some insuring companies will not cover liveaboards, and will retroactively cancel to policy inception if the discover that a liveaboard situation is present. Other companies will just note the policy as a liveaboard and take no further action.

.

And a reminder that lying to an insurance company or more politely misleading them is like handing them free money. They don't check out all you put on the application. But they do check when you file a claim. I knew someone who owned a car in NY. Registered it in SC at his brother's address and insured it there. Was in an auto accident in NY. Car was totaled. They investigated and refused the claim. When he said he was going to sue them, they did suggest he might prefer to just quietly walk away rather than deal with their counter of insurance fraud.

 

[Pau Hana]

In our yacht club marina, the live-aboards are also slip-huggers who have not moved their boat in years, except to have the bottom painted. Isn't a boat safer sittin' in a slip than underway?

Unfortunately, too often we see surveys on these types of boats that show a high level of neglect to running gear, safety gear, etc.

 

[Pau Hana]

And a reminder that lying to an insurance company or more politely misleading them is like handing them free money. They don't check out all you put on the application. But they do check when you file a claim. I knew someone who owned a car in NY. Registered it in SC at his brother's address and insured it there. Was in an auto accident in NY. Car was totaled. They investigated and refused the claim. When he said he was going to sue them, they did suggest he might prefer to just quietly walk away rather than deal with their counter of insurance fraud.

Indeed. This is the premise of operating under "uberrimae fidei" or "uttermost good faith". This means that all parties of an insurance contract must reveal all aspects material to the risk, even if not asked.

I can't speak as to the specific example given, but in the marine side, the questions pertaining to loss history, experience (ownership and operational), liveaboard status, etc., are all part of the underwriting process- and can lead to a denied claim and/or possible legal action if deception is discovered.

 

[BandB]

Indeed. This is the premise of operating under "uberrimae fidei" or "uttermost good faith". This means that all parties of an insurance contract must reveal all aspects material to the risk, even if not asked.

I can't speak as to the specific example given, but in the marine side, the questions pertaining to loss history, experience (ownership and operational), liveaboard status, etc., are all part of the underwriting process- and can lead to a denied claim and/or possible legal action if deception is discovered.

And if you actually collect on a claim in that situation, then it rises to criminal fraud. And don't think for a moment insurers won't prosecute to make their point and recover their money.