A very important piece of NY boat insurance is the physical damage coverage that protects the hull and physical features of your boat. Just like with your auto insurance there are comprehensive and collision physical damage coverages that can be part of your NY boat insurance policy. If you have physical damage coverage on your boat insurance policy, most insurance companies will pay for damage to your boat if you’re involved in accident or another covered loss, regardless of who is at fault. In these instances you are only responsible to pay the policy deductible.
Collision Coverage for Boat Insurance
When most people think of boat insurance physical damage coverage they think about collision. Collision coverage applies if you collide with another boat or object. This could mean colliding with a dock, with another boat, with a buoy out on the water, there are many different instances in which you can collide and be at fault and it is these instances in which collision physical damage coverage on your boat insurance policy will respond.
Comprehensive Coverage for Boat Insurance
In addition to collision coverage there is also comprehensive physical damage coverage. Comprehensive physical damage coverage on your NY boat insurance policy applies if your boat is damaged in an incident other than a collision such as a fire, theft or vandalism.
When you buy physical damage coverage on your boat insurance policy you have a choice as to how you want to resolve the claim. This is method with which your boat will be valued:
Methods for Valuing Boat Insurance
Actual Cash Value: with actual cash value coverage the insurance carrier will pay you the market value of your boat at the time of the loss or on a rating basis whichever is the lower amount of money. The rating basis for most companies is often whatever the current market value was at the time that you initially purchased the policy minus any time-based depreciation.
Agreed Value: with agreed value coverage the insurance company pays the agreed value of your boat, an amount you previously chose and to which the insurance company agrees, regardless of its current market value at the time of the loss. To determine your boat’s value you can refer to your sales receipt if you purchased your boat in the recent past, or have an appraisal from an accredited marine survey company.
Replacement Cost/Purchase Price: with replacement cost/purchase price coverage the insurance company replaces your boat with a new boat that is to the greatest extent possible the same make class size and type with comparable equipment. If you choose not to replace your boat or if it’s more than five years old at the time of the loss the insurance company will pay the original purchase price.
Each form of valuing your boat for purposes of boat insurance physical damage coverage comes with its own unique premium price point. In most cases you will find that actual cash value is the least expensive then agreed value with replacement cost or purchase price coverage being the most expensive of the three options. That being said NY boat insurance compared to an auto insurance or home insurance policy is often very inexpensive regardless of which method you choose to value the physical damage coverage for your boat.
The Insurance Take-Away
Determining the method for which you want to value your boat when purchasing boat insurance is very important because it will ultimately determine the amount of money you get back in the event that you completely wreck your boat.
If you need help making this determination we would love to assist you please call us at 518-456-6688 or click here to begin a quote by email.
A Murray Group representatives will help walk you through the process of properly purchasing New York boat insurance.
Thank you and good luck,
Ryan Hanley, CIC