Insurance or not?

JimTid said:

.................. I hope I can continue to find coverage I can afford and never have to use it.

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Someone posted on another forum that "you only get back about thirty percent of what you pay into insurance premiums."

I have no idea what he meant by that or what he was smoking at the time he posted that.

The goal is to not get back any of the money you spend on insurance premiums (with the exception of life insurance). This means you never had a claim for your boat or a claim against you from another person.

What the premiums pay for is the peace of mind of knowing that if there is a claim, your insurance company will take care of it.

Seevee said:

Totally disagree on this.... how many folks don't have liability when it IS required, as in cars?

Why not require mandatory training? Make a LOT more sense.

How about Prevention instead of Payment for losses.

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In most states you can't renew your tags without proof of insurance but there are folks getting around this. It's a mater of stricter law enforcement.

We have "mandatory training" for driving cars and trucks yet we continue to have accidents. Lots of accidents. Again, stricter law enforcement could make a dent in this.

There is no way to prevent accidents. Airplane pilots are highly trained and airplanes have a strict maintenance schedule by highly trained mechanics yet we still have accidents. Navy captains are highly trained yet we have at least two highly publicized recent ship accidents.

"...75% had NO training."

That's like saying that 75% of car drivers who had accidents last year never passed a skid-pad test. (Right. Because skid-pad tests aren't required to get a license.)

I don't think many people would argue that mandatory boater training would be a good thing. But you're making everyone's point: if 25% DID have some training, and still had accidents, then training doesn't solve all situations and so, we all still should be required to have insurance. But again, presumably our premiums would be lower with more training.

My personal opinion is that at a minimum, insurance companies should require training for their policy holders. I honestly don't know why they don't.

Sealife said:

Depends if you can "afford" the loss. If a $250k boat is a toy and a tiny percentage of your total assests, sure. But if you have dumped your life savings into a floating home to travel in retirement, no.

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Exactly.

No different then when I would decide to drop collision for the car.
But honestly, given the ability to raise the deductible to reduce the premium, whether for car or boat, it becomes pretty hard to justify NOT having insurance, notwithstanding all the other issues.

Richard

Seevee said:

BandB,

Look at the stats, that's just NOT correct. About 75% of the accidents the boater had NO training. Now, a professional probably has more exposure, but still the stats favor being a pro by a huge margin.

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I agree with you that boater training (and licensing) should be mandatory in every state but this is not likely to happen anytime soon and it's not part of this insurance discussion.

You don't have to be operating your boat to have a liability claim.

Anchor your boat and go ashore in your dinghy. The boat breaks loose and drifts into another boat and damages it. You are liable.

Seevee said:

BandB,

Look at the stats, that's just NOT correct. About 75% of the accidents the boater had NO training. Now, a professional probably has more exposure, but still the stats favor being a pro by a huge margin.

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I said "major". By that I'll put a dollar amount on it. Those resulting in $5 million or more damage. Then I'll reiterate that most of those are by professionals. Key word is "major." The point is that professionals do make mistakes. On the road, on the water. None of us, except possibly you, are mistake proof.

WesK said:

I don't know how on earth you managed to get that from what I posted. Go back and read my post again, this time with the thought of understanding what I posted not with the thought of how to argue with it. :bang head:

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WesK,

You said: Second, your level of coverage is a judgement call and depends in part on your own financial worth and your perceived risk. The higher your coverage, the lower the cost per dollar. Two million does not cost twice what one million costs and ten million doesn't cost five times what two million costs.

There's an implication there that your level of insurance, which means how much insurance you carry should be dictated by your financial worth and perceived risk.

What does that mean to you?

BandB said:

I said "major". By that I'll put a dollar amount on it. Those resulting in $5 million or more damage. Then I'll reiterate that most of those are by professionals. Key word is "major." The point is that professionals do make mistakes. On the road, on the water. None of us, except possibly you, are mistake proof.

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You're right with regard to "huge/major" accidents in which a pro is required to operate those big ships. Big ships can cause big damage.

However, we may have a few in this group that operate huge ships but for the bulk of us that operate personal trawlers, the stats are in our favor if we do get training..... and that's from the NTSB reports, not me.

I'm not quite mistake proof. Yes, I've written the check for some of my mistakes. But the goal is to still try to eliminate the mistakes.

"Insurance is a moral requirement on my part. But then I don't throw crap out the car window while driving either."

Seevee said:

Totally disagree on this.... how many folks don't have liability when it IS required, as in cars?

Why not require mandatory training? Make a LOT more sense.

How about Prevention instead of Payment for losses.

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There is mandatory training here in NY for younger boaters that has been in place for many years - just the crowd that tends to get into problems.
I see that those that are responsible are much better trained and those that are not it makes no difference. As posted previously the accidents that I have seen first hand have tended to be by a younger group that have had the training. I am not at all against training but it does not make much difference in the liability of boating.
There are also plenty of safety laws around hear as well - tickets are getting handed out quite plentifully the past few years. I am also not against the safety laws but they do not seem to produce much of a difference in the practice of boaters.
Hence - having decent insurance is a very good idea.

Training is a good idea....and I don't think anyone would argue that it could reduce claims. But think about what kind of training would be offerred. A 6 hour course ? 15 hours ? For a newbie boater that would be great....but if you make a guy who has been boating safely for 25 years take that class, he's not going to be any less likely to have an accident.

Look at Driver's Education that new drivers have to take. It helps a lot....but there are still automobile accidents. The navy certainly provides training.....There was a ferry accident recently on Cape Cod that had a professional captain...... Then there's Hurricanes...you may be Joe Perfect, but when a hurricane pushes your boat into mine....I've got damages that you're responsible for..... Insurance should be looked at as just another cost of boating like fuel, electronics, and zincs. If you can't afford the insurance, you can afford boating.

Benthic2 said:

............. If you can't afford the insurance, you can afford boating.

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Did you mean to post "you can't afford boating" ?

If so, I agree with you 100%.

I think boater training (not just safety but how boats actually work and "at the helm" training) would reduce accident significantly.

As it is now, in most of the USA, you may or may not have to pass a "rules" test, but you can buy, rent or borrow a boat and get behind the wheel thinking it operates just like a car. It does not.

Benthic2 said:

Training is a good idea....and I don't think anyone would argue that it could reduce claims. But think about what kind of training would be offerred. A 6 hour course ? 15 hours ? For a newbie boater that would be great....but if you make a guy who has been boating safely for 25 years take that class, he's not going to be any less likely to have an accident.

Look at Driver's Education that new drivers have to take. It helps a lot....but there are still automobile accidents. The navy certainly provides training.....There was a ferry accident recently on Cape Cod that had a professional captain...... Then there's Hurricanes...you may be Joe Perfect, but when a hurricane pushes your boat into mine....I've got damages that you're responsible for..... Insurance should be looked at as just another cost of boating like fuel, electronics, and zincs. If you can't afford the insurance, you can afford boating.

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WesK said:

Did you mean to post "you can't afford boating" ?

If so, I agree with you 100%.

I think boater training (not just safety but how boats actually work and "at the helm" training) would reduce accident significantly.

As it is now, in most of the USA, you may or may not have to pass a "rules" test, but you can buy, rent or borrow a boat and get behind the wheel thinking it operates just like a car. It does not.

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WesK,

Ahhh,
We agree on something.... totally agree that training would reduce accidents, and the NTSB stats show that.

As much as I hate to see govt get involved in things and make new laws, it would be simple to just require a boater safety card for starters. Good for the basics and better than nothing, and cheap or free, online and not hard to do.

As for on the water training, not sure how to implement that, but I'd for sure use private parties and not the govt.

.... now back to the spicy insurance issue....
The cost of insurance is unlikely a deal killer in the total cost of ownership/operation of a boat. For our group, it's not huge, but could be a fairly large part of the operating expenses. It's not that a person is too cheap, or can't afford it, it's an expense that one has to decide if it's reasonable for him.

Easting said:

"Insurance is a moral requirement on my part. But then I don't throw crap out the car window while driving either."

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Good point but I could argue that good and safe operating practices are MORE of a moral requirement.

Here's another issue....

The insurance company may not pay a claim or may reduce the claim and operate in bad faith. Geico, who is a big insurer of boats has have a number of bad faith suits against them, and I doubt those were happy customer. AllState and State Farm are much worse, but not sure if they do boats.

Sure, you can go to court and sue your insurance company and go thru that hassle. There was one company that was found guilty of intentional bad faith fraudulent dealings with customers, with a memo that told the adjusters to "wear out the client" so we can get out of paying.

Some other factors ....
You still have to pay the deductible
You may be able to write a loss off as a causality loss
If you self insure, you only deal with yourself, you decide how to fix it.

On the other side,
There are some great agents out there that will go to bat for you and makes a difference, and there are companies that get the job done fine and quick. I went thru a claim with Nationwide, whose client crashed their car into my business destroying a lot of expensive equipment and they had a no questions asked check for the full amount within a week which was incredible (and a BIG sum). The award was large enough to consider shutting down the business rather than trying to rebuild it. So, it does work, sometimes.

In Japan the training required to drive a car is close to what in the USA is required to drive a small air craft.

They still crash.

Insurance is what you need.to cover a cost you cant.

So to say insurance is just another cost of.boating is too general as not all types of.insurance are necessarily needed.

There is no absolute.there, yes liability is a good.idea unless you are destitute, but hull issurance is cometely debatable.

As.WXX3 pointed out, dropping collision on an old vehicle is common, why not with boats?

Hull insurance is completely up to you, but liability insurance protects you and everyone else. If you sink my boat and injure me, I don't want to take your boat, your car, your house, and throw your wife and children out on the street (assuming you have a wife and children), but that would be the result if you don't have liability insurance.

I know that there are problems in the insurance industry, and some (maybe most) insurance companies are reluctant to pay out. I once sued my insurance company because they would only pay 90% of a large claim. A tornado had destroyed some buildings I owned. I won of course. And I now have a suit pending against the owner of a truck that hit our parked car. His insurance company only paid 2/3 of my claim. But liability insurance is still better than the alternative, which is financial ruin for the at fault party.

sorry for the typo....yes...I meant if you can't afford insurance, you CAN'T afford boating.

Benthic2 said:

sorry for the typo....yes...I meant if you can't afford insurance, you CAN'T afford boating.

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Yea, I think we understood, but that makes absolutely no sense. Affording is not the question... a good use of one's dollars is.

Benthic....still pnly partially correct....and Seevee caught it too.

Boating for some is barely one step up from being homeless.

While I too think liability should be required to operate any machinery, the discussion is lost on some who always post things like they are all or nothing according to their limited world view.

For those that argue that liability insurance should not be mandatory would you agree that if a person has no liability insurance he cannot wipe out the liability by bankruptcy?

Those who preach no mandatory liability insurance have yet to experience a 20k + damage to thier boat by an idiot with no insurance. Also the impact that idiot's actions has on your future plans, not to mention the money impact.

I am the guy that never purchases extended warranty.


I have always insured every boat that I have owned and will continue into the future.


Believe that liability insurance should be required and presented at time of registration of the boat.


All that said, our last boat stayed in South Florida year around. I accepted the 30% deductible from damage caused by a named storm if the boat was south of cape hatteras.


I have insurance for the liability - since damage under maritime law is proportional - not necessarily assigned blame. Responsibility may be split. I have insurance for the possible EPA contamination. A few hundred gallons of diesel let loose is not a good thing. I believe the cap on fine is $850K. To me - that is substantial.


Mark

Again, anyone ever been fined for oil/fuel spill?

A few hundred gallons of diesel is almost impossible to clean up unless you boom it off immediately....or are in a very confined space.

On the Columbia River if a 50 gallon spill occurs, someone WILL report it the the USCG and Washington DNR and Washington EPA come at you from the forest and are relentless.

We had a 1929 tug sink right in front of pur dock and put about 300 gallons of fuel in the water. USCG spokesman on the scene state that it wasn't bad and that it would desipate. You could hear DNR and the EPA folks screaming at the USCG folks. They wpuld be seeking the maximum fines against the owner.

Liability, yes, please.

Property, if you can't afford the loss, yes.

If you can, it just depends on how you value the time without it. Insurance overhead is around 45-50 cents on the dollar, a horrible investment in general, nothing you would ever put money into for your 401k, but if you can't live without a boat and it takes you a couple of years to replace a loss, then maybe.

psneeld said:

Again, anyone ever been fined for oil/fuel spill?

A few hundred gallons of diesel is almost impossible to clean up unless you boom it off immediately....or are in a very confined space.

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Can I give you a specific example of a fine for someone I know? No

Do I want to expose myself to the liability for a fraction of boat coast? No

If everyone had insurance the cost would go down because no one would have damage from boaters without insurance. Also, as the number of policy holders goes up, the data pool that insurers use gets deeper, allowing them to get more specific with rates. Think about your auto insurance. That factors in your education, credit rating, marital status......with more data, pricing can get more sophisticated and higher risk boaters identified and charged accordingly, and lower risk boaters given lower pricing.

kev_rm said:

...... Insurance overhead is around 45-50 cents on the dollar, a horrible investment in general, ......

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what do you mean by this ? Life insurance is sometimes sold as an investment...but not property/liability insurance....so I'm not following you here...