As with any insurance policy, it is important to carefully read the policy to ensure that you have all the coverage's, for that you are paying and need. Many companies exclude certain damages such as damage from underwater objects or damage as a result of freezing. With this in mind you will want to get an all risk policy that has the fewest exclusions possible. Having to add insurance riders to your policy to cover excluded details only adds to the total cost.
Insurance Liability Types
Liability covers property damage and personal injury to everyone except the insured and immediate family members. It protects the insured against financial loss and pays on behalf only if named insured is found liable. This makes liability insurance absolutely necessary however there is choices to make.
Split Limit
Split limit liability coverage is similar to the type of coverage you usually see with automobile liability insurance. Few people understand this type of liability coverage. If your liability limits are 100/300/100, that means you have $100,000 in coverage per person, $300,000 in coverage per occurrence and $100,000 in coverage for property damages. So if you have five passengers in the boat, you only have $300,000 in coverage to split between those five passengers. That's only $60,000 each. The more people on board, the lower the coverage per person.
Protection and Indemnity
Protection and indemnity coverage is the most common and usually the cheapest type of liability coverage available. Protection and indemnity coverage provides a single dollar limit for both liability and property damage combined which will be paid on your behave in the event of a problem. With this type of coverage the number of people involved does not matter as the limit is on the amount paid out per claim, not per person.
Towing Liability
Towing liability covers your boat and anything that could happen to it while being pulled or towed thus making it a must have. Be sure to confirm that this coverage is included in your policy and never assume that it's included in the policy as many companies exclude this coverage or charge more for it.
