Boat insurance guide: types, cover, and cost factors

Whether you own a small boat or a larger, sea-going cruiser, it’s essential that you have the right boat insurance.

Boat owners must be aware of the increased risk of theft and damage to marine equipment, which, according to the Police Crime Prevention Initiatives (PCPI), has increased in recent years.

As well as theft and damage, there is plenty to think about when it comes to insuring your boat, so we’ve put together this guide to boat insurance for new boaters and seasoned sailors alike.

• Do I need boat insurance?
• What does boat insurance cover?
• What is excluded from a standard boat insurance policy?
• Do I need a licence to own and insure my boat?
• How much does boat insurance cost?
• What factors can affect the cost of boat insurance?

Do I need boat insurance?

Boat insurance protects your vessel, its equipment, your liability to other craft on the water, and the people on your boat.

While it is not a legal requirement to have insurance simply if you own a boat, you will need at least third-party cover to use it on the UK’s inland waterways. Most UK harbours and marinas also insist on a minimum of third-party cover to protect all their customers.

What does boat insurance cover?

There are two types of cover you can take out when insuring your boat:

• Boat insurance: cover for the boat, equipment, and possessions, and third-party liability.
• Third-party liability only: cover for damage or injury caused to another person or their property.

Boat insurance

If your boat is damaged in a collision, and that collision is your fault, the repair costs will be down to you. So, it makes sense to protect your investment with insurance.

Boat insurance can include cover for:

• Accidental and malicious damage to your boat, engine, and equipment.
• Boat theft. The smaller the boat, the easier it is to steal. It’s not uncommon for a small boat to be stolen from a driveway.
• Theft of equipment, fittings, and personal items. Navigation and communication equipment and outboard motors are particularly vulnerable.
• If your boat isn’t a total write-off after sinking, getting it back in working order might be expensive. It’s not only the cost of the boat’s repair; you’ll also be responsible for the retrieval or salvage of the boat.
• Fire damage. Although one of the least common causes for claims, fire can destroy a boat.
• Damage caused by grounding or collision with an underwater object.
• Transporting your boat by road exposes it to additional risks, such as road traffic accidents and lifting and launching accidents.
• Accidental damage caused by racing (Alan Boswell Group automatically provides cover for local club racing in all sailboat policies).

Third-party liability

Third-party liability insurance provides cover for any loss or damage caused by you for:

• Damage to another boat and/or equipment. Collisions are the number-one cause of boat insurance claims.
• Injury to another person.

In short, third-party insurance covers damage you cause to other people, but won’t cover injury or damage to yourself or your property.

What types of boat can be insured?

The type of boats that can be covered under a boat insurance policy include:

• motorboats;
• dinghies and sailing boats;
• rowing boats;
• river pleasure cruisers, such as holiday boats used on the Norfolk Broads and similar waterways;
• narrowboats;
• larger, sea-going sailing boats, yachts, and motorboats.

At what age is a boat considered a classic?

There is some debate in the marine world about what constitutes an antique or classic boat, but the Antique and Classic Society use the following definitions:

• Historic: boats built up to and including 1918.
• Antique: boats built between 1919 and 1942, inclusive.
• Classic: boats built between 1943 and 1975, inclusive.

To secure insurance for a boat over 60 years old you will normally be required to complete a form self-certifying that the boat is seaworthy and provide the insurer with photographs of the vessel. Boats over 100 years old will require a full survey before they can be insured.

Alan Boswell Group boat insurance includes a 125% repair clause (meaning it will pay a further 25% over the sum insured) to recognise that older boats can be more expensive to repair than their market value.

Do you need different insurance for boats that are used both at sea and inland?

Some insurers cater exclusively for boats used on inland waters, like canal boats and cruisers used on the Norfolk Broads, but Alan Boswell Group caters for those used inland or at sea.

The premium will depend on how and where the boat is used, its cruising range, and its value.

What is excluded from a standard boat insurance policy?

Each boat insurance policy will have its own specific policy wording and exclusions, but a standard boat insurance policy will usually exclude the following:

• Deterioration and loss of value due to wear and tear, lack of maintenance, and ageing.
• Damage caused by vermin, insects, marine life, and damp.
• Wilful misconduct or neglect.
• Damage to machinery following a breakdown, fault, or short circuit.
• Damage done while the user is under the influence of alcohol or drugs.
• Racing cover, although Alan Boswell Group sailboat policies automatically include local club racing cover.

As well as these standard exclusions, there are a few other scenarios where boat insurance policies differ, and it’s essential to check that you have the right cover for your boat and how you will use it.

• Policy excess: this is the first part of any claim that you will have to pay yourself. Make sure you are happy with the level of excess, which can also sometimes be increased to reduce the premium.
• Seasonal cover: some policies only provide cover for you to use the boat at certain times of the year, with it stored ashore for the rest of the time. Check if your policy has any such limitations.
• Cruising limits: does your policy have any restrictions on the cruising range? For example, you may have to extend your limits if you’re leaving coastal waters.
• Water sports: if you plan to use your boat for water sports, such as towing toys or water skiers, check that you are covered.

It’s important to remember to update your insurance if you purchase additional equipment, or change the specification of your boat, to ensure your cover isn’t invalidated in the event of a claim.

Do I need a licence to own and insure my boat?

To simply own a boat that is kept ashore, you don’t need a licence.

To use your boat on inland waterways you will need to register your boat, and you may also need a licence, a Boat Safety Scheme (BSS) certificate and third-party insurance with a minimum indemnity limit of £1m. Although this can vary; the Broads Authority, who are responsible for the Norfolk Broads, requires a minimum indemnity limit of £2m.

The BSS certificate applies to all boats fitted with cooking, heating, refrigeration, or lighting powered by a permanent electrical system.

If you are required to have a Boat Safety Scheme (BSS) certificate and licence but use your boat without one, then your insurance would be invalidated.

To find out if you need a licence, BSS certificate, or will need to pay a toll, check with the navigation authority which manages the waterway you will be using.

If you plan to take your boat beyond UK territorial waters to another country, you must carry a registration document administered by the UK Ship Register.

Do I need a qualification to use my boat?

No, you don’t need any qualifications to use a boat on inland waters. For insurance purposes, insurers will often be more interested in seeing evidence of your experience over qualifications.

If you plan to sail your boat in overseas territories, you may need the International Certificate of Competence issued by the RYA. Different countries have different rules, so check before you travel.

We would recommend any boat owner to consider gaining a qualification. The RYA courses are a good place to start, more information can be found here.

Can someone else insure my boat?

Yes, as long as they have an ‘insurable interest’ i.e., they must stand to suffer a loss should there be a claim. For example, if you charter or offer a long-term loan to a friend, who subsequently damages it, they will have to pay for the repair if it isn’t insured.

Your policy may also allow you to lend to other users, in which case someone else would be permitted to use your boat as long as they had your permission – but be sure to check your policy wording which will detail if this is covered and if there are any terms.

How much does boat insurance cost?

The cost of boat insurance varies significantly depending on the type of boat, its value, top speed, where it is used and moored, and the experience and claims history of the owner.

What factors can affect the cost of boat insurance?

Many factors can influence your boat insurance premium, some of which relate to the type of boat and what it’s used for, plus other factors like security, mooring location, and value.

The type of boat

A small boat used inland will naturally be cheaper to insure than a large sea-going yacht. The value of your boat is a significant factor in the cost of insurance, while its engine power is an additional consideration.

How you use your boat

The cost of boat insurance is partly determined by how and where you use your boat. Is it used for short trips on inland waterways or for longer offshore trips, including to overseas territories?

While Alan Boswell Group includes cover for local sailing racing, some insurers charge extra for such activities, so always check if you are paying over the odds for racing.

Boat security

Security is a huge factor in the cost of boat insurance, but there are many measures you can take to prevent theft, help recover stolen goods and, in some cases, reduce your premium:

• Use a proprietary engine lock to secure outboard motors and padlocks or combination padlocks to secure hatches and fuel caps.
• When your boat is being stored on land, secure the boat – and trailer – to a solid structure and use wheel clamps on the trailer.
• Ensure that your property is identifiable. Make a note of any serial numbers on equipment and mark each item – covertly and more obviously – with identifiable information, such as a postcode, date of birth, or name.
• Take photographs.
• Moor your boat in a marina and ask if it has CCTV.

Further tips on making it as easy as possible for the police to recover stolen property can be found here.

Your boating experience and claims history

Your premium may be cheaper if you are an experienced boater with no history of having made claims in the past. If you have made previous claims, you may pay a higher premium depending on how long ago they were.

Boat insurance excess

Different insurers will have different standard excesses, but it may be possible to voluntarily increase your excess to gain a discount on your premium.

Multi-vessel discounts

Alan Boswell Group offers a discount to those who own two or more boats.

No-claims bonus

The longer you go without making a claim, the higher the premium discount you accrue. With our boat insurance, you can build a discount of up to 25%.

Boat insurance is essential to give you peace of mind while you enjoy the tranquillity of Britain’s waterways.

To get a boat insurance quote, give us a call on 01603 649650.