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Whether your boat is docked at a local marina or stored in your private boathouse, boat insurance can protect you from risks on the water. While boat insurance is not mandatory, it can cover damages, liability and other unforeseen events. So, if you are already daydreaming about the sun shining on the waves or that perfect fishing cast, it’s never too early to make sure you have the right coverage for your watercraft. Let’s take a deeper dive into what boat insurance is, what types of coverage there are and answers to your most frequently asked questions.

Although boating insurance is not mandatory in Ontario, there are many reasons to consider protecting your investment against risks. Transport Canada’s Boating Laws and Regulations BOATsmart! website, notes that “You are not legally required to insure your boat, however, it is highly encouraged. Your homeowner’s insurance will not sufficiently protect your investment.”

When it comes to insuring your boat, it’s often best to separate your boat insurance from your homeowner’s policy. It is important to note that the type of boat you have will often dictate how you need to insure it.

The best way to insure your watercrafts

If you own a smaller, non-motorized watercraft, it may be covered under your home or cottage insurance. Many homeowners’ policies include perfectly good coverage for smaller boats and motors, usually with a limit of 25- to 100-horsepower. This may also automatically include coverage ranging from $2,500 to $5,000. Some examples of watercrafts that would be covered are:

  • Canoes
  • Kayaks
  • Small fishing boats

Larger and motorized watercrafts, however, often require specialized coverage, as many homeowners’ policies limit or don’t cover marine-specific risks.  They can be insured under a home insurance as “scheduled property.” A separate rate will be charged and the boat will be insured to its full value. Some examples are:

  • Bass boats
  • Cabin cruisers
  • Bowriders
  • Pontoon boats

For serious boaters, marine craft-like sail boats, speed boats, yachts or boats that travel into coastal waters should be covered under their own separate policy.

Tip: Make sure to insure your trailer and boating accessories, as well. Just call your isure broker to discuss!

Reasons to carry boat insurance

While boat insurance is not a requirement in Ontario, it could be a very costly decision in an attempt to save money on your monthly expenses. In fact, there are many reasons that support having boat insurance, including:

  • Liability coverage for injuries to people on the boat, in the water or on other boats
  • Liability coverage for property damage as a result of operating the boat/watercraft
  • To obtain storage privileges at a marina or other boating facility
  • It helps to secure financing for the purchase of new watercrafts
  • Better coverage than what may be covered under home insurance
  • To keep boat-related claims separate from your home insurance policy
  • As your boat ages, it will help guarantee that it is still seaworthy each year (Survey may be required)

What boat insurance covers

Most policies will protect your boat and personal belongings against risks, as well as provide liability coverage protection for your passengers. Boat insurance will typically cover liability for water sports activities, too. Here are some other coverages included:

  • Coverage for risks as a result of weather, theft, fire and vandalism
  • Loss and damage due to accidents
  • Emergency towing and loss of use
  • Medical costs and accident benefits for operator and passengers
  • Damage or loss to navigation equipment, sports equipment and personal belongings
  • Pollution and wreck removal
  • Damage to furniture, the hull, sails, motors and trailers

What boat insurance does not cover

It’s important for you to speak with your isure broker to better understand what exclusions may exist in your current policy, such as:

  • Damage from ice or freezing temperature
  • Depending on the size or type of watercraft, there may be navigational limits to where and how far you can travel
  • Damage from pests, like rodents and animals, while docked or stored

Factors determining insurance pricing 

Rates for boat insurance may vary based on a variety of factors. The information that an insurance company requires about a boat and its operators is similar to the type of information it needs to provide auto insurance. The average premium can range anywhere from $300 to $1,000+.

Here is a list of factors that may help determine your rates:

  • The boat’s length, type and value
  • The boat’s size and horsepower
  • Experience, loss and claims history of the operator(s)
  • Navigational range allowed and if you charter your boat
  • Its condition and market value – your insurer may ask for a survey if your boat is more than 15 years old
  • How frequently the boat is used, what it’s used for and how and where it is stored
  • Additional equipment (GPS, trailor, etc.)
  • Possession of Pleasure Craft Operator Card

If you also own a cottage, you may have outbuildings, such as a boathouse, garage or shed. You may need additional coverage to ensure that these buildings are fully protected – be aware of coverages and exclusions. 

6 tips when it comes to boat safety

According to the IBC.ca, here are six safety tips to ensure that you are practicing safe boating:

  1. Keep your Pleasure Craft Operator (PCO) card with you. Federal regulations specify that anyone who operates a boat with a motor in Canada must have a PCO card on them.
  2. Before boating, check the weather forecast. Ensure there are no hazards, such as high winds or approaching thunderstorms.
  3. Plan ahead. Know where you are going because getting lost on the water is no fun. Bring a map and tell someone where you are going and when you expect to return.
  4. Fill up the gas tank. Ensure that your boat has enough fuel for your outing. Keep tools, spare parts, a first-aid kit and other safety equipment – such as paddles, whistles and flares – on board.
  5. Ensure that every person has a lifejacket. The law requires boats to be equipped with a Canadian-approved lifejacket or PFD of an appropriate size for each person on board. Make sure your PFD is comfortable and allows for easy movement. Check that seams are intact and all snaps, belts and zippers work properly. Remember, bright colours are easier to spot in an emergency.
  6. Be responsible. Boat sober because boats and booze don’t mix (and it’s against the law.) Sun, wind, noise, glare, vibrations and motion can heighten the effect of alcohol on your balance, vision, judgment and coordination. Don’t allow a person who has consumed alcohol to operate a boat.

Keeping boating insurance costs low

There are a few ways to help keep your premiums as low as possible without short-changing yourself on coverage:

  • Combine your policy with auto or home insurance to get a better price
  • Maintain a clean driving record
  • Complete nautical training courses
  • Stay claims-free
  • Compare quotes from multiple insurers

FAQS ABOUT BOAT INSURANCE

Is boat insurance mandatory in Ontario? 

No, boat Insurance is not mandatory in Ontario. However, if you are financing a boat or mooring it at a marina, they’ll likely require you to have insurance.

Why should I insure my boat or personal watercraft?

Being out on the waves can be risky and you want to protect your boat and your loved ones from damage or injury.

Does my driving record on my car affect my boat insurance premiums?

Yes, it does. Motor vehicle convictions can be used in rating your boat insurance premiums.

Who can drive my boat?

Anyone who is legally eligible to drive your boat and has your permission is covered to drive.

Drivers under the age of 12 need to be accompanied by an adult and will have some horsepower restrictions. Also, too many additional drivers on your policy often results in increased premiums.

What is the best coverage for my boat?

It is best to have what is known as an “All-Risks” policy, which will provide coverage for all types of losses, except those specifically excluded in the policy.

What are some exclusions with boat insurance?

Typical exclusions may include wear-and-tear, gradual deterioration, marring, denting, scratching, animal damage, manufacturer’s defects, defects in design, and ice and freezing.

What are the differences between boat and yacht insurance?

Generally, boats are considered to be 26′ and smaller, while yachts are 27′ and larger. On average, yacht coverage is broader and more specialized because larger boats travel further and have more unique exposures.

Why should I insure my personal watercraft all year?

Threats to your boat exist all the time, not just when it’s in the water. In the offseason, there are damage risks from weather, vandalism and more.

Does boat insurance cover the trailer?

Your policy will offer protection for physical damage to the trailer, but will not cover you for liability. If your trailer causes damage to another vehicle, your auto insurance will then kick in.

Do I need a survey for boat insurance?

It depends on the age of your boat and your insurer. Older boats may be required to get a survey annually.

Does boat insurance cover storm damage?

Yes, your boat insurance will include protection from storm damage, unless it’s specifically excluded.

What is the difference between marine and boat Insurance?

The main difference is marine insurance is for commercial boats, while boat insurance is for personal watercrafts.

Do I still need insurance if my boat is stored at a marina?

Yes, the marina does not cover your boat. You will need insurance to cover any damage or loss when it is in storage at a marina.

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