Boat Owners Package Policies

Boatowners Package Policies

Last reviewed February 2, 2010

A General Discussion

Introduction

The combination of exposures to loss connected with ownership of a pleasure boat is not dissimilar to that experienced by automobile owners. In response to these coverage needs, several companies have developed package policies for boat owners that, like automobile package policies, include physical damage, liability, and medical payments insurance. Unlike automobile insurance, however, each boat owners package policy is a particular creation of the insurer that offers it. Most such policies contain similar provisions and conditions, but differences among them need to be considered in light of the individual boat owner’s insurance needs. This discussion is based on an analysis of several boat owners package policies that are representative of this type of coverage. And, this discussion is followed by a survey of various insurers’ boat owners package policies.

Coverage Under a Homeowners Policy

A certain amount of physical damage, liability, and medical payments coverage is afforded insureds by their homeowners policies. However, the physical damage coverage in standard homeowners forms is limited to $1500 on watercraft, including their trailers, furnishings, equipment, and outboard engines or motors. And, the homeowners policy does not cover loss of watercraft or the furnishings and equipment caused by theft that occurs off the residence premises.