"Liveaboard insurance" vs. "cruising insurance"

Kawini · Sep 6, 2019

I am buying a boat from a gentleman who will carry a small loan for about a year. As a condition of this short-term financing, he is requiring that I maintain appropriate insurance coverage until the loan is paid. I find this totally reasonable, and would have of course insured the boat in any event.

The wrinkle is that the seller is -- for some reason -- requesting that I maintain "liveaboard insurance" on the boat. I live in New Mexico, and I plan to cruise the boat throughout the PNW for 4-5 months/year. For the remainder of the year, the boat would be alone in its slip with occasional visits and short cruises. My understanding is that this is not "liveaboard."

Can someone out there in the insurance industry (looking at you PauHana) clarify for me what constitutes "liveaboard" status insofar as insurance is concerned? Does 4-5 months recreational cruising constitute liveaboard status for purposes of insurance?

Thanks !!!

psneeld · Sep 6, 2019

Let your insurance company decide...mine did.

It should be transparent to the former owner unless a lender can somehow b liable in any way.

Pau Hana · Sep 6, 2019

Kawini said:
I am buying a boat from a gentleman who will carry a small loan for about a year. As a condition of this short-term financing, he is requiring that I maintain appropriate insurance coverage until the loan is paid. I find this totally reasonable, and would have of course insured the boat in any event.

The wrinkle is that the seller is -- for some reason -- requesting that I maintain "liveaboard insurance" on the boat. I live in New Mexico, and I plan to cruise the boat throughout the PNW for 4-5 months/year. For the remainder of the year, the boat would be alone in its slip with occasional visits and short cruises. My understanding is that this is not "liveaboard."

Can someone out there in the insurance industry (looking at you PauHana) clarify for me what constitutes "liveaboard" status insofar as insurance is concerned? Does 4-5 months recreational cruising constitute liveaboard status for purposes of insurance?

Thanks !!!

Hola!

For your lienholder, the only stipulation should be that you carry Agreed Value coverage with him/her named as the lienolder. This will ensure that, in the case of a total loss, the lienholder is made whole (the note is paid off, and any remaining funds will come to you).

Liveaboard coverages/endorsements generally extend the following coverages from onboard/while loading or unloading to anywhere in the world:

Liability
Medical
Personal Effects

In essence, this replicates the coverages of an HO-3 policy (standard homeowner's policy).

As a general rule, we (agents and underwriters) look at liveaboards in this way- your primary residence is aboard your vessel year round. For your situation, I see you as a seasonal cruiser, and (since you have a primary residence elsewhere) would have no need to offer you any liveaboard coverage.

I'd be happy to speak with your lienholder if you'd like.

Pau Hana · Sep 6, 2019

The only wrinkle I see is this- ensuring that there is a proper boatwatch/caretaker of the vessel due to the distance between your NM home and the boat...but that is easily solved.

Comodave · Sep 6, 2019

Yes, some insurance companies may require you to have a plan as to how you will be checking on the boat with you being a remote owner. There are companies that do it for a fee.

"Liveaboard insurance" vs. "cruising insurance"

Kawini

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psneeld

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Pau Hana

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Pau Hana

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Comodave

Moderator Emeritus

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