L.l.c.?

[psneeld]

Originally Posted by LN-RTP

What is a nickel and dime level license?

In the commercial world pretty much anything from 100 ton down but OUPVs are a dime a dozen.

Doesn't mean they were easy to get...but past 25T or 50T masters, they thin out pretty fast. (my experience is getting old now as I last taught in 2007 or so.)

My experience with people commenting on the licenses, is if you haven't owned and proved a lot of boats in different parts of theUS, thenany USCG helps as it was given based on "proven" sea time.

But yes, my last couple insurance companies did say at some point of even boat ownership/experience and low claim rate...you do max out on discounts.

[LN-RTP]

Originally Posted by psneeld

In the commercial world pretty much anything from 100 ton down but OUPVs are a dime a dozen.

Doesn't mean they were easy to get...but past 25T or 50T masters, they thin out pretty fast. (my experience is getting old now as I last taught in 2007 or so.)

My experience with people commenting on the licenses, is if you haven't owned and proved a lot of boats in different parts of theUS, thenany USCG helps as it was given based on "proven" sea time.

But yes, my last couple insurance companies did say at some point of even boat ownership/experience and low claim rate...you do max out on discounts.

Yeah, I get insurance discounts for both experience and tickets, OUPV, 50t then 100 ton. My initial sea time was all commercial, tankers, bulk cargo and a passenger ship. (Norwegian Merchant Marine) The USCG loved it as it was all documented in my Sea Time Logbook)

I have also worked in aviation as B747 Captain, but never looked down my nose and ridiculed younger guys, with lesser tickets flying smaller planes calling them nickel and dime pilots or holding nickel and dime licenses.
We all started somewhere and we have all been low time as well as learning, whether airborne or on the water. Mutual respect.

[psneeld]

Originally Posted by LN-RTP

Yeah, I get insurance discounts for both experience and tickets, OUPV, 50t then 100 ton. My initial sea time was all commercial, tankers, bulk cargo and a passenger ship. (Norwegian Merchant Marine) The USCG loved it as it was all documented in my Sea Time Logbook)

I have also worked in aviation as B747 Captain, but never looked down my nose and ridiculed younger guys, with lesser tickets flying smaller planes calling them nickel and dime pilots or holding nickel and dime licenses.
We all started somewhere and we have all been low time as well as learning, whether airborne or on the water. Mutual respect.

I don't think many of the really high time (but 100 ton or less) commercial guys I worked with looked down on anyone unless they opened their mouths and tried to insinuate their license was really big time but their conversation showed how little they really knew.

Look at some of the licensed captains here that routinely incorrectly state some of the most common NAVRULEs..... gotta wonder when they should be able to put their fingers on a reference very quickly before they post to make sure they don't sound silly.

[LN-RTP]

I don't think many of the really high time (but 100 ton or less) commercial guys I worked with looked down on anyone unless they opened their mouths and tried to insinuate their license was really big time but their conversation showed how little they really knew

My comment was in response to the Navy guy who said

will have more to do with experience than with any nickel and dime level license.

Seems like he felt anything below his level was nothing..

[psneeld]

Awe, not sure he meant it that way as much as the guys who go through the captain mills and get a six pack just to call themselves "captain" and have never run anything bigger than a Grady White walkaround and never more than 50 miles from home. Saw plenty of them in my classes.

Most knew their limitations, a few were just loudmouth jerks...ya know...like the rest of society.

[LN-RTP]

Originally Posted by psneeld

Awe, not sure he meant it that way as much as the guys who go through the captain mills and get a six pack just to call themselves "captain" and have never run anything bigger than a Grady White walkaround and never more than 50 miles from home. Saw plenty of them in my classes.

Most knew their limitations, a few were just loudmouth jerks...ya know...like the rest of society.

Aha, so you were teaching classes?
Yes, I can see how a few would feel the need to be an Instant Captain but lose sight of the big picture, like responsibility and taking good care of your passengers who thrust you with their lives.
The "Captain" stuff and the stripes are meaningless if the holder is just there for the glory: Empty suit

[rgano]

Originally Posted by psneeld

Awe, not sure he meant it that way as much as the guys who go through the captain mills and get a six pack just to call themselves "captain" and have never run anything bigger than a Grady White walkaround and never more than 50 miles from home. Saw plenty of them in my classes.

Most knew their limitations, a few were just loudmouth jerks...ya know...like the rest of society.

Wasting USCG time and resources.....

[CarlF]

If the owner thinks that he might ever charter the boat, an LLC is pretty much required for liability protection. In most case as long as the owner is nowhere near the boat when the accident happens then only the LLC can be sued capping the owner’s loss at the value of the boat. This protection does require that the owner be careful to preserve the separation. The LLC should have a bank account and credit card that be used for all boat related expenses.

A boat being actively chartered can also be run as a business as an LLC so expenses and revenue offset each other. Depreciation can even be taken. However if the boat business loses money every year, the IRS is likely to reclassify the business as a hobby and deny the deductions. A audit of prior years could leave you paying. Buying an LLC exposes you to all the past accounting practices and is a bad idea unless your accountant goes over the previous tax returns carefully.


The LLC does have to pay sales tax in the initial purchase. It only avoids sales tax for later purchasers if they take over the LLC - which as mentioned has downsides.

[MYTraveler]

Originally Posted by CarlF

In most case as long as the owner is nowhere near the boat when the accident happens then only the LLC can be sued capping the owner’s loss at the value of the boat.

Even though your view is commonly held, at least among non-lawyers and others who believe that the US justice system operates the way it "should", I am skeptical that an owner can escape liability for negligent maintenance and hiring practices that contribute to a loss, even if the owner is nowhere near the boat when the accident happens. For example, look at the liability faced by the owner of Conception, the dive boat that burned and sunk off Santa Barbara island a few years ago. The reality is, liability for one's negligent acts of commission and omission is virtually impossible to escape, at least in the absence of a knowing assumption of risk. Moreover, even when one isn't negligent, it is easy enough for a plaintiff's lawyer to allege circumstances that would create liability to get the question in front of a jury. And even winning there is a big loss, given the cost of high stakes litigation. FWIW, I am qualified by both personal experience and education to be confident of my thoughts.

[Seevee]

I could make an argument that an LLC is a lousy entity to hold a boat in, UNLESS, you're using the boat in a business. There is "some" protection, to the limits of the assets of the LLC, but one's books need to be impeccable.



If you're the operator, no entity will protect you from liability, and the first line of defense is a good liability policy. If you're a stockholder, lender or trustee, there is virtually NO liability issues.


I really like trusts to own things, especially anything that moves, holds people, cuts, chops or is something that one can fall off of. The trustee and the beneficiary have virtually NO liability issues, and you can easily hide a trust. There are no records of a trust, unless it owns property, and then the only thing you see on title is the Trustee, who is protected from liability by law (at least in Florida).



As for insurance, the trust can have an insurance policy which might name you as an operator or decision maker.


I only have one LLC and that's for property management. Trusts for all property, boats, planes, cars, cycles, chain saws, lawn mowers, and ladders.



As for using an LLC to sale sales tax ....... "maybe", but the other disadvantages have already been mentioned.

[CarlF]

Originally Posted by MYTraveler

Even though your view is commonly held, at least among non-lawyers and others who believe that the US justice system operates the way it "should", I am skeptical that an owner can escape liability for negligent maintenance and hiring practices that contribute to a loss, .

My lawyer agrees with you. He felt it was only worth using an LLC for tax accounting purposes for a charter business. Maybe you also gain a bit of liability protection but maybe not. He felt it worked best if a yacht management company made all decisions regarding boat maintenance without even consulting the owner. But even then, “piercing the corporate veil” is common. He felt that a better option if not chartering the boat was usually to hold the boat in the owners name and have a $5M umbrella excess liability policy on the home owners insurance (which costs little) on top of $2M liability in the boat policy.

[MYTraveler]

Carl, I too have chosen the umbrella policy route, but as I understand it, there is no relationship between one's net worth and an adequate coverage amount. In other words, whether your net worth is $1M or $10M or $100M, if your are at fault in an accident resulting in, say $6M of liability, you are still exposed for the additional $1M. For example, consider three guys who each carry $5M of liability insurance, and each is at fault in a separate accident causing $6M of losses, with the only difference between the three being their net worths, which are, hypothetically, $1M, $10M and $100M, respectively, In that circumstance, the guy with a $1M net worth is wiped out, despite having done the socially responsible thing by maintaining significant coverage.

So, instead of looking to one's net worth, it seems to me that the adequacy of coverage is a function of how much damage one might negligently inflict. I settled on $15M, even knowing that I occasionally cross paths with $100M vessels. Oddly, I expected the marginal cost of additional coverage to decrease, but in shopping for coverage, that was not my experience (and I have a squeaky clean loss history).

[mvweebles]

Originally Posted by LN-RTP

Yeah, I get insurance discounts for both experience and tickets, OUPV, 50t then 100 ton. My initial sea time was all commercial, tankers, bulk cargo and a passenger ship. (Norwegian Merchant Marine) The USCG loved it as it was all documented in my Sea Time Logbook)



I have also worked in aviation as B747 Captain, but never looked down my nose and ridiculed younger guys, with lesser tickets flying smaller planes calling them nickel and dime pilots or holding nickel and dime licenses.

We all started somewhere and we have all been low time as well as learning, whether airborne or on the water. Mutual respect.

I certainly understand your point, but in the case of lower level USCG licenses, sea time is mostly self-reported, so there are a relatively large number of "captains" who have very little practical experience and passed the exam by taking a 2-week cram course. "Nuckel and dime" may not have been the choice of words I'd use, but I definitely draw a distinction between holding a license and having experience.

While I'm not closely familiar with pilots' licenses, my sense is that flight-time documentation requirements are much more closely scrutinized.

While everyone has to start somewhere, sure seems like a lot of "captains" want to jump the line a bit with their USCG license credentials. There is a lot of puffery out there on the docks.

Peter
(Past USCG 100T Master)

[CarlF]

Originally Posted by MYTraveler

Carl, I too have chosen the umbrella policy route, but as I understand it, there is no relationship between one's net worth.

I agree that net worth does not factor in. My insurance agent suggested that what works for you is that the insurance companies pay for the defense and will fight very hard to not lose $5M. They will reach an agreement with the other side before trial with the threat that they can otherwise drag the thing out for a decade. Or win a lower judgement since the other side always bears some fault. Juries evidently don’t feel much sympathy or outrage for a guy whose yacht got scratched by another yacht.

The umbrella policies are inexpensive because they hardly ever come into play. My agent could only think of two times in his career. One involved the insured operating an 18th century canon in Concord Massachusetts while dressed as a British Red Coat to commemorate the start of the American Revolution.

I decided that $5M (plus $2M in the policy) was the right risk/cost balance for me but that’s a personal decision. Nothing wrong with going higher.

[psneeld]

The words "nickle and dime" were used...

this is what I added and maybe insurance companies are just smart enough to know it...

"In the commercial world pretty much anything from 100 ton down but OUPVs are a dime a dozen."

Which I realize wasn't punctuated well but was meant to say that just getting an OUPV nowadays is not necessarily easy but yes some relatively easy to document sea time, a few hundred dollars and a cram course will probably get you one.

Many of my students did just want to say they spent enough time on the water to earn the title "captain" and in the old days had the pretty wall certificates. I didn't have the heart to remind them the "O" in OUPV is for operator, not captain...

Just kidding... many of them by the end of the course realized just what really it entails to be a good captain and many left the course actually a bit humbled and said they would try and keep learning the "hands on" info they were exposed to.

[Cold Duck]

In Kona Hawaii it's almost impossible to get a slip unless the boat is already a LLC so the slip goes with the boat. If not, there's a waiting list with about a 20 year wait and the slip must be given up when the boat under normal ownership is sold and given to the next on the list. So, needless to say, almost all boats in the harbor are under LLC. Special circumstance but an import issue in Kona.

[Shrew]

Originally Posted by Painless

2. If You go to the effort to obtain a "Captain's License " and something goes wrong, or someone gets injured aboard Your boat or by your boat, are You held to a higher standard as a Captain than just a regular boat owner as far as liability?

Col Regs are Cole Reg's. Either you followed them or you didn't. To contend that a licensed captain is held to a higher standard is to infer that recreational boaters are not subject to adhering to Col Reg's.

Both licensed and recreational boaters are required to understand Col Reg's, however it is only the professionals who are tested. That doesn't mean that recreational boaters get to use the "But I didn't know" defense.

When an accident occurs, responsible is assigned to those that didn't follow the published procedure.

[bowball]

Originally Posted by MYTraveler

Carl, I too have chosen the umbrella policy route, but as I understand it, there is no relationship between one's net worth and an adequate coverage amount. In other words, whether your net worth is $1M or $10M or $100M, if your are at fault in an accident resulting in, say $6M of liability, you are still exposed for the additional $1M. For example, consider three guys who each carry $5M of liability insurance, and each is at fault in a separate accident causing $6M of losses, with the only difference between the three being their net worths, which are, hypothetically, $1M, $10M and $100M, respectively, In that circumstance, the guy with a $1M net worth is wiped out, despite having done the socially responsible thing by maintaining significant coverage.

So, instead of looking to one's net worth, it seems to me that the adequacy of coverage is a function of how much damage one might negligently inflict. I settled on $15M, even knowing that I occasionally cross paths with $100M vessels. Oddly, I expected the marginal cost of additional coverage to decrease, but in shopping for coverage, that was not my experience (and I have a squeaky clean loss history).

Agree in general but there are factors where net worth should be considered, I believe.

First, the damages of things like death etc aren't objective numbers, unlike property damage, and lawsuits could easily go up to the maximum of insurance limits, unless the individual is high net worth where they might pursue higher damages.
Second, there is an element of risk aversion involved, as to what a high but not outlier damage award can do to one's quality of life. Jeff Bezos will more likely be sued for a higher than normal dollar amount of damages if they have a subjective element to them, and he can more easily self insure and won't be affected even by extreme awards.