Insuring a "Totaled" Boat

[EqualParts]

Hello Fellow Boaters

Asking for insurance advice: we own a fiberglass 1985 Grand Banks 42, which we have used in Florida in winters since 2007. She has been stored on land during summer under a Quonset-hut-like hoop-and-fabric shelter. Hurricane Ian a year ago threw that structure against her port side, obliterating all stainless and teak hand-rails and cap rails. Zero hull or interior damage. Apart from this heavy cosmetic damage, she is in very good shape and 100% useful. Repair costs equal agreed-value policy from Geico which declared her a “constructive total loss”; the buyback was $5k so we still own her and are repairing her.

Problem now is that a “totaled” boat seems almost impossible to insure. Totaled cars with salvaged titles can be insured after professional inspection.

Have any of you experience with this situation or have ideas? Thanks.

 

[O C Diver]

Are you looking for complete coverage, or liability only?

Ted

 

[EqualParts]

Are you looking for complete coverage, or liability only?

Ted

Seeing as though getting her insured is likely difficult, liability only would be ok.

 

[sunchaser]

Can you get liability, medical and environmental damages insurance only? If so and combined with a standard Umbrella policy it seems you’d be ok.

So even if the boat were to sink with some onboard injuries you’d be covered and only out $5K and your sweat equity for current repairs. Pau Hana can set us straight.

 

[O C Diver]

If it were me, I would take lots of pictures to document the condition and repairs. Maybe get an insurance survey to document the repairs and have an impartial opinion that neither the hull nor any machinery was damaged. Then shop for liability insurance. You're probably going to want to put this file together if down the road you decide to sell the boat. I doubt you will be able to remove the salvage title, but having documentation, pictures, and possibly an insurance survey may make the boat easier to sell to someone willing to accept a liability only boat.

Ted

 

[slowgoesit]

If the boat is Federally Documented, to the best of my knowledge, there is no such thing as a Federally Documented salvage title. If the vessel is State Titled, consider getting it Federally Documented. The "salvage" or "branded" title becomes immaterial.

Having said that, if the insurance company asks you if the vessel has been totaled, or asks if, to the best of your knowledge, there has been any insurance claim against it, you need to answer honestly.

Personally, with the last three boat insurance companies we have had coverage with, only one asked if there had ever been any insurance claims against the vessel. There haven't been, but that's not the point. If they don't ask, it's up to you whether or not to volunteer additional information.

 

[tiltrider1]

Call Peter Ricks at Novamar Insurance in Seattle 206 281 8144. He was an underwriter for Gieco before he went out on his own. He can tell you how to best handle your situation.

 

[Comodave]

Call Peter Ricks at Novamar Insurance in Seattle 206 281 8144. He was an underwriter for Gieco before he went out on his own. He can tell you how to best handle your situation.

+1. He is really good.

 

[O C Diver]

If the boat is Federally Documented, to the best of my knowledge, there is no such thing as a Federally Documented salvage title. If the vessel is State Titled, consider getting it Federally Documented. The "salvage" or "branded" title becomes immaterial.

Having said that, if the insurance company asks you if the vessel has been totaled, or asks if, to the best of your knowledge, there has been any insurance claim against it, you need to answer honestly.

Personally, with the last three boat insurance companies we have had coverage with, only one asked if there had ever been any insurance claims against the vessel. There haven't been, but that's not the point. If they don't ask, it's up to you whether or not to volunteer additional information.

While I don't know for a fact, my guess is that the insurance companies use a database that includes vessel ID numbers. My guess is that the ID number will trigger such things as "stolen", "Total Loss Claim Paid", or "Salvage Title". I don't ever remember an insurance company asking to see the title to one of my boats.

Ted

 

[slowgoesit]

While I don't know for a fact, my guess is that the insurance companies use a database that includes vessel ID numbers. My guess is that the ID number will trigger such things as "stolen", "Total Loss Claim Paid", or "Salvage Title". I don't ever remember an insurance company asking to see the title to one of my boats.

Ted

Ted, that's very likely, but it requires the insurance company to do their due diligence! If they don't, and if you are not asked, then I'm pretty sure you're golden!

None of my comments should be construed to imply that necessary repairs should not be completed competently, and with documentation, and I would also recommend that a competent surveyor be involved in the repairs and the final results as well. I also am NOT implying that you should lie to an insurance company, ever!

 

[SIBERNUT]

What state ? Laws differ, and "CONSTRUCTIVE". TL can be different.

 

[EqualParts]

What state ? Laws differ, and "CONSTRUCTIVE". TL can be different.

We're in MN, but the boat is only used in FL.

 

[Larry M]

Talk to a long time surveyor in the area. You situation can’t be unique.

As far an insurance survey, you might want to get limited condition survey and/or a damage survey. That information might be nice to have when you’re talking to insurance companies.

The insurance market has changed for the worse in the last few years, unfortunately. Good luck.

 

[PhilPB]

Is your boat titled in MN or FL?

Similar thread on another forum. You can look up the

FSS 328.045

"the insurer shall deliver to the department an application for a new certificate that complies with s. 328.01 and includes the title brand designation “Hull Damaged.” Not later than 30 days after delivery of the application to the department, the department shall create a new certificate that indicates that the vessel is branded “Hull Damaged.”"


AND listed on the FLSENATE.GOV website:

328.045 Title brands.—
(1) Unless subsection (3) applies, at or before the time the owner of record transfers an ownership interest in a hull-damaged vessel that is covered by a certificate of title created by the department, if the damage occurred while that person was an owner of the vessel and the person has notice of the damage at the time of the transfer, the owner shall:
(a) Deliver to the department an application for a new certificate that complies with s. 328.01 and includes the title brand designation “Hull Damaged”; or
(b) Indicate on the certificate in the place designated for that purpose that the vessel is hull damaged and deliver the certificate to the transferee.
(2) Not later than 30 days after delivery of the application under paragraph (1)(a) or the certificate of title under paragraph (1)(b), the department shall create a new certificate that indicates that the vessel is branded “Hull Damaged.”
(3) Before an insurer transfers an ownership interest in a hull-damaged vessel that is covered by a certificate of title created by the department, the insurer shall deliver to the department an application for a new certificate that complies with s. 328.01 and includes the title brand designation “Hull Damaged.” Not later than 30 days after delivery of the application to the department, the department shall create a new certificate that indicates that the vessel is branded “Hull Damaged.”
(4) An owner of record who fails to comply with subsection (1), a person who solicits or colludes in a failure by an owner of record to comply with subsection (1), or an insurer that fails to comply with subsection (3) commits a noncriminal infraction under s. 327.73(1) for which the penalty is $5,000 for the first offense, $15,000 for a second offense, and $25,000 for each subsequent offense.
History.—s. 8, ch. 2019-76.

 

[Old Sea Dog]

OP stated that the hull was not damaged.

 

[SoWhat]

A totaled 1985 boat in FL. Good luck getting hull insurance. I self insure hull. No problems getting liability insurance.

 

[PhilPB]

OP stated that the hull was not damaged.

I'm not an attorney so that part if the law can be argued by others . It’s clear as mud! Excerpts from the statute:

“Hull damaged” means compromised with respect to the integrity of a vessel’s hull by a collision, allision, lightning strike, fire, explosion, running aground, or similar occurrence, or the sinking of a vessel in a manner that creates a significant risk to the integrity of the vessel’s hull.

Also:
(5) A certificate of title is prima facie evidence of the accuracy of the information in the record that constitutes the certificate and of the ownership of the vessel. A certificate of title is good for the life of the vessel so long as the certificate is owned or held by the legal holder. If a titled vessel is destroyed or abandoned, the owner, with the consent of any recorded lienholders, shall, within 30 days after the destruction or abandonment, surrender to the department for cancellation any and all title documents. If a titled vessel is insured and the insurer has paid the owner for the total loss of the vessel, the insurer shall obtain the title to the vessel and, within 30 days after receiving the title, forward the title to the department for cancellation. The insurer may retain the certificate of title when payment for the loss was made because of the theft of the vessel.

 

[PhilPB]

I just have an agreed value for the boat so I can obtain insurance. Our marina, and others we've visited in Fl have asked if we had insurance. Our home marina actually retains a copy of the declaration of insurance and are also named on it as well as "additionally insured"

 

[STB]

This is not universal and may be less common than the OP thinks.

Florida has no salvage titles. If it did a ton of fine, seaworthy vessels in the state would be 2nd class citizens. It is a state pounded by storms.

About 5 years ago, I bought my present vessel from someone in the process of restoring it after buying it at an insurance auction. It had taken on a significant amount of water at the slip, only being saved from totally sinking by the shallowness of the slip. Neither that owner nor I have had any problems with insurance.

The vessel was state titled at the time I bought it and federally documented before and since. The title is perfectly clean. The list of owners show the auctioneers.

The person I bought it from had it insured with SkiSafe. My insurance is from State Farm. State Farm was willing to offer full liability coverage and up to $40,000 for the vessel without a survey, giving me time to fix things.

The State Farm agent told me that they potentially gig the owner, not usually the vessel, in the event of a major claim. The person who owned the vessel at the time of the incident told me that he had trouble getting insurance for his new vessel for a while afterward, so that may be more broadly true.

The vessel across from me had a major electrical fire. It was bought back by the owner for a small residual value after being "totaled". It was fully insured after repair and inspection. I think by the same insurer, Progresssive, who reportedly told the owner, before he bought it back, that they'd reinsurance it after repair and a survey.

The vessel next to me, I think also insured by Progressive, sunk at its slip. It was fixed, major repairs -- except for the stuffing box that caused the problem (they didn't get to that, yet. Yes, really!), and it nearly sunk, again, at its slip. The second time the owner took the settlement and the vessel sold at an insurance auction. The new owners made minor repairs, got full coverage insurance without a survey, and are now underway, taking it hundreds of miles to their home port for repairs. They are pumping it out underway. The vessel is insured via Edward Williams (https://www.edwardwilliam.com/), who is reportedly willing to do full liability and a vessel value up to $45,000 without a survey.

I think insurers deal with risk differently and, with "vintage" boats, it is easy to look in the wrong places and find insurers who are very brittle w.r.t. what they are willing to do. I also think there are folks willing to price the risk and write policies. State Farm has been a problem solver for a few folks I know.

I also think there is a huge difference between the support a major marine player like Progressive can provide immediately during the crisis vs another type of insurer. I don't think State Farm can do much other than write a check once it is all over. Progressive seemed to be able to do that -- as well as organize emergency support and repair contractors when asked.

Also, I do think the credit score and claim history (even outside of boats) and history with the insurer can change things. I don't thinkcit is all about the boat or boating.

Maybe one of the insurers mentioned above can help.

 

[STB]

The vessel is insured via Edward Williams (https://www.edwardwilliam.com/), who is reportedly willing to do full liability and a vessel value up to $45,000 without a survey.

I just looked at this insurer's web page for myself. They seem to be based overseas and handle claims only via online interfaces, e.g. not by phone, etc.

I then looked for ratings and reviews on the Web. Y'all can come to your own conclusions. I'm going to go back to offering up State Farm and SkiSafe as ideas for folks needing insurance and having some trouble.


https://www.cruisersforum.com/forums/f2/edward-william-insurance-268247.html

And this thread:

https://www.reddit.com/r/sailing/comments/wd6pva/edward_william_insurance_do_not_use_them/


And this thread:

https://www.sailnet.com/threads/insurance-edward-william-marine-services.54477/


And this thread:

https://forum.norfolkbroadsnetwork.com/topic/19411-northern-reefedward-william/

 

[bhumphrys]

Seeing as though getting her insured is likely difficult, liability only would be ok.

Try Progressive online. That’s who I have. I would think liability only would be a non-issue.

 

[Shrew]

The boat has been totaled. You've been paid out the entire value of the boat (agreed upon). You decided to buy it back for $5,000. What is your agreed upon hull value going to be? $5K?

I can't imagine any insurance company willing to effectively pay you a second time for the same boat. So essentially, I can't imagine anyone underwriting this with a comprehensive policy.

What you may have done is paid the insurance company to dispose of a totaled boat for them.

 

[rslifkin]

The boat has been totaled. You've been paid out the entire value of the boat (agreed upon). You decided to buy it back for $5,000. What is your agreed upon hull value going to be? $5K?

I can't imagine any insurance company willing to effectively pay you a second time for the same boat. So essentially, I can't imagine anyone underwriting this with a comprehensive policy.

What you may have done is paid the insurance company to dispose of a totaled boat for them.

That's one way to look at it, but at the same time, once the boat is repaired and has a new survey with an estimated value, the boat is worth something regardless of having been previously totaled. Being an insurance write-off doesn't permanently drop its value to zero.

 

[STB]

That's one way to look at it, but at the same time, once the boat is repaired and has a new survey with an estimated value, the boat is worth something regardless of having been previously totaled. Being an insurance write-off doesn't permanently drop its value to zero.

Bingo.

And, for the Mainship with a bad DSS next to me, Progressive did, in fact, pay twice for the same boat.

I was/shocked/ they allowed so much time to get the root caused fixed. It was, Inching, 14 months and counting when it went down the 2nd time due to a shaft seal leak combined with bilge pump failure.

 

[EqualParts]

Thanks for all the great responses. Trying to "reply all" here, so to speak.

Cheers!

Can you get liability, medical and environmental damages insurance only? If so and combined with a standard Umbrella policy it seems you’d be ok.

So even if the boat were to sink with some onboard injuries you’d be covered and only out $5K and your sweat equity for current repairs. Pau Hana can set us straight.

Thanks for your reply. While waiting for possible boat insurance, we have increased home-owners policy umbrella and listed the boat explicitly on umbrella. The best advice so far re boat, from Novamar Insurance, is getting her repaired, have a NAMS or SAMS survey and then some brokers think she can be insured.

If it were me, I would take lots of pictures to document the condition and repairs. Maybe get an insurance survey to document the repairs and have an impartial opinion that neither the hull nor any machinery was damaged. Then shop for liability insurance. You're probably going to want to put this file together if down the road you decide to sell the boat. I doubt you will be able to remove the salvage title, but having documentation, pictures, and possibly an insurance survey may make the boat easier to sell to someone willing to accept a liability only boat.

Ted

Thanks for your reply. Boat has USCG documentation; don’t think there is any such thing as salvage USCG document. Tons of pictures. We will be able to demonstrate that boat works well and that damage was big-time “cosmetic”.

If the boat is Federally Documented, to the best of my knowledge, there is no such thing as a Federally Documented salvage title. If the vessel is State Titled, consider getting it Federally Documented. The "salvage" or "branded" title becomes immaterial.

Having said that, if the insurance company asks you if the vessel has been totaled, or asks if, to the best of your knowledge, there has been any insurance claim against it, you need to answer honestly.

Personally, with the last three boat insurance companies we have had coverage with, only one asked if there had ever been any insurance claims against the vessel. There haven't been, but that's not the point. If they don't ask, it's up to you whether or not to volunteer additional information.

Thanks for your reply. Boat has USCG documentation; agree there is any such thing as salvage USCG document. Agree with you re honest reporting. Apparently some insurance companies look up hull ID on some sort of internet site for prior insurance claims.

Call Peter Ricks at Novamar Insurance in Seattle 206 281 8144. He was an underwriter for Gieco before he went out on his own. He can tell you how to best handle your situation.

Thanks for reply. Agree re Novamar! The best advice so far re boat , from Novamar Insurance, is getting her repaired, have a NAMS or SAMS survey and then some brokers think she can be insured.

Talk to a long time surveyor in the area. You situation can’t be unique.

As far an insurance survey, you might want to get limited condition survey and/or a damage survey. That information might be nice to have when you’re talking to insurance companies.

The insurance market has changed for the worse in the last few years, unfortunately. Good luck.

Thanks for your reply. While waiting for possible boat insurance, I have increased home-owners policy umbrella and listed the boat explicitly on umbrella. The best advice so far re boat , from Novamar Insurance, is getting her repaired, have a NAMS or SAMS survey and then some brokers think she can be insured.

A totaled 1985 boat in FL. Good luck getting hull insurance. I self insure hull. No problems getting liability insurance.

Thanks for your reply. Yes, FL is a nasty location. While waiting for possible boat insurance, I have increased home-owners policy umbrella and listed the boat explicitly on umbrella. The best advice so far re boat , from Novamar Insurance, is getting her repaired, have a NAMS or SAMS survey and then some brokers think she can be insured. Novamar’s opinion, so far, is that a well-cared-for 1985 GB is insurable.

This is not universal and may be less common than the OP thinks.

Florida has no salvage titles. If it did a ton of fine, seaworthy vessels in the state would be 2nd class citizens. It is a state pounded by storms.

About 5 years ago, I bought my present vessel from someone in the process of restoring it after buying it at an insurance auction. It had taken on a significant amount of water at the slip, only being saved from totally sinking by the shallowness of the slip. Neither that owner nor I have had any problems with insurance.

The vessel was state titled at the time I bought it and federally documented before and since. The title is perfectly clean. The list of owners show the auctioneers.

The person I bought it from had it insured with SkiSafe. My insurance is from State Farm. State Farm was willing to offer full liability coverage and up to $40,000 for the vessel without a survey, giving me time to fix things.

The State Farm agent told me that they potentially gig the owner, not usually the vessel, in the event of a major claim. The person who owned the vessel at the time of the incident told me that he had trouble getting insurance for his new vessel for a while afterward, so that may be more broadly true.

The vessel across from me had a major electrical fire. It was bought back by the owner for a small residual value after being "totaled". It was fully insured after repair and inspection. I think by the same insurer, Progresssive, who reportedly told the owner, before he bought it back, that they'd reinsurance it after repair and a survey.

The vessel next to me, I think also insured by Progressive, sunk at its slip. It was fixed, major repairs -- except for the stuffing box that caused the problem (they didn't get to that, yet. Yes, really!), and it nearly sunk, again, at its slip. The second time the owner took the settlement and the vessel sold at an insurance auction. The new owners made minor repairs, got full coverage insurance without a survey, and are now underway, taking it hundreds of miles to their home port for repairs. They are pumping it out underway. The vessel is insured via Edward Williams (https://www.edwardwilliam.com/), who is reportedly willing to do full liability and a vessel value up to $45,000 without a survey.

I think insurers deal with risk differently and, with "vintage" boats, it is easy to look in the wrong places and find insurers who are very brittle w.r.t. what they are willing to do. I also think there are folks willing to price the risk and write policies. State Farm has been a problem solver for a few folks I know.

I also think there is a huge difference between the support a major marine player like Progressive can provide immediately during the crisis vs another type of insurer. I don't think State Farm can do much other than write a check once it is all over. Progressive seemed to be able to do that -- as well as organize emergency support and repair contractors when asked.

Also, I do think the credit score and claim history (even outside of boats) and history with the insurer can change things. I don't thinkcit is all about the boat or boating.

Maybe one of the insurers mentioned above can help.

Thanks for your detailed reply and stories of insurable vessels. Boat is USCG documented. Haven’t tried Progressive and only State Farm inquiry was inconclusive.

The boat has been totaled. You've been paid out the entire value of the boat (agreed upon). You decided to buy it back for $5,000. What is your agreed upon hull value going to be? $5K?

I can't imagine any insurance company willing to effectively pay you a second time for the same boat. So essentially, I can't imagine anyone underwriting this with a comprehensive policy.

What you may have done is paid the insurance company to dispose of a totaled boat for them.

Thanks for your reply. Yes we helped out the insurance company by buying the boat back. Reason: it is “our boat”, it works well, and will be close to normal after repair. Some brokers think she can be insured for nearly the same hull value as before.

 

[guy with a boat]

The boat has been totaled. You've been paid out the entire value of the boat (agreed upon). You decided to buy it back for $5,000. What is your agreed upon hull value going to be? $5K?

I can't imagine any insurance company willing to effectively pay you a second time for the same boat. So essentially, I can't imagine anyone underwriting this with a comprehensive policy.

What you may have done is paid the insurance company to dispose of a totaled boat for them.

Insuring the boat for liability and actual value (might be $5K) is legitimate and might make sense. Once the repairs and improvements are complete, the real value of the boat increases and should then be insurable at that higher value.

Insurers often require surveys prior to issuing the policy, and that should save them from paying a second time for the same damage. I think once the damage is correctly repaired and the boat is inspected/surveyed, the prior damage won’t be much of an issue.