Get Up To Speed on Boat Insurance & Licensing
Even bystanders appreciate boat operators being properly insured, especially for liability coverage!
If this boater is insured, his insurance company will be paying for those injuries caused by his boat accident. If he is not insured, he could be sued personally.
Operators & Convictions
Many boat operators do not know that boating convictions will appear on their driver abstract.
This means that boating convictions (impaired, speeding, dangerous driving and reckless driving etc) can affect your auto rates, and that convictions earned while driving your car can affect your boat insurance rates. Accidents and convictions may mean that standard boat insurers may decline your business, sending you to high risk boat insurance, with the corresponding high risk rates.
There are many discounts available, making it smart to shop and compare, as not all companies offer all discounts.
Some insurance companies offer discounts on your boat policy if they also insure your home or a second boat. Other discounts include:
- Canadian Power and Sail Squadron Course completed by principal operator
- on-board fire alarm and/or security systems
- diesel engine on inboard/outboards
- self bailing motors
- paying a higher deductible
Getting Your Boat Licence
If you are 23 years old, you’ll need a boating licence to operate a power boat or jet ski. If you don’t have one, you’ll be fined $320.
If you are 24 years old and older, you’ll need to be licensed by 2009. Once you have your licence, you’re licensed for life.
Over the next few years, new rules for getting a licence may come up, and the examination may become increasingly difficult. For your convenience, we have partnered with BOATsmart Canada so you can easily get your boating licence, online. Included is an online practice test that scores you. If you try it, and pass it, you should be ready to pass your exam to receive your licence. Click on the link below to check it out:
(To do the Practice Test click on the “Safe Boater Training” link).
Boats Added to Homeowner’s Policy
Many homeowner, condominium or tenant policies will automatically insure the smaller boat for liability coverage, if the boat meets their policy limits. Usually this means the boat is a sailboat under 26 feet in length, has an outboard motor under 25 HP or and inboard/outboard under 50 HP. To confirm your boat coverage limits, look under the Limitations and Exclusions section of your homeowner’s policy, as not all home policies are created equal. Boats not covered here must be insured under a Boat Policy.
Most insurance brokers or agents recommend $2-million in liability as adequate boat liability. Physical damage coverage can often be added at a relatively low cost or may be included with a low limit, usually around $3,000.
Types of Boat Policies
Boat insurance comes in many sizes, shapes and packages. There are variations in coverage, claims handling, and policy types. Rates can vary wildly. So here’s what we can tell you
Generally, your boat coverage includes protection from physical damage to the hull and motor (these may be combined or separate), and also liability coverage, which includes medical payments. Many policies also include emergency towing and even loss of use.
Boats can be insured under an “All Risk” policy or a “Named Perils” policy. Under the All Risk policy, everything is covered unless it’s specifically excluded. The Named Perils policy is less expensive, and only includes the perils that it lists: usually fire, lightning, explosion, theft, windstorm, collision or overturns. All policies have a deductible.
Types of Coverage
Boats may be insured for an “Agreed Value” or “Actual Cash Value”. The Agreed Value policy pays the amount stated in your policy after a write-off. The Actual Cash Value is the current market value, where depreciation has been applied. A marine survey is usually required to qualify for an Agreed Value policy.
Rates & Acceptability
Your rate and acceptability will depend on many factors, including:
- use of the boat (business, commercial or boat rentals require special policies)
- age of the boat operators, their driving records and boating experience
- the boat’s construction, age, value, Horse Power, and length
- your boat claims history
Boating & the Law
The Department of Transportation attaches a Capacity Plate to the hull of each boat, which could be powered by a motor over 10 HP. The plate states the recommended Horse Power limit. If a motor installed exceeds that limit, most insurers will not insure the boat. The boat application requires this “maximum hull speed limit”, and if you later install a motor with a higher limit, your insurance claim can be declined.
Personal Watercraft need to be registered and the Small Vessel Regulations requires that all craft with an engine 10hp or more and under 15 gross tons be registered.
Boating and safety regulations are administered by Transport Canada. Information is available at Safe Canada or by calling the Boating Safety Infoline at 1-800-267-6687.
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