Understanding Boat Insurance

If you own a boat, you likely understand the joys of being out on the water, but you also know that accidents and unexpected events can happen. Boat insurance can help protect you from the financial consequences of damage, theft or liability that can occur while operating your vessel. Whether you’re cruising a lake, fishing off the coast or storing your boat during the off-season, knowing what your policy covers, and where it might fall short, can make a significant difference.

What Does Boat Insurance Cover? 

Boat insurance generally covers two main areas: liability and physical damage. Liability coverage steps in if you’re held responsible for injuring someone or damaging their property while using your boat. That could include something as simple as bumping into another vessel at the dock or more serious incidents on open water.  

Physical damage coverage can help pay for repairs or replacement if your boat is damaged due to a collision, bad weather, theft or vandalism. You can also buy coverage for specific situations, like uninsured boaters who cause an accident but don’t have insurance themselves, or towing assistance if your engine fails while you’re on the water. 

Beyond the basics, many policies can be customized to match how you use your boat and what you keep on board. If you regularly carry valuable personal items like fishing gear, navigation electronics or water sports equipment, you may also want protection for those. Trailer coverage and wreckage removal can also be essential, particularly if your boat is involved in a serious accident or sinks and must be removed under legal requirements. For boaters concerned about environmental risks, pollution liability can help cover the cost of cleaning up fuel or oil spills. 

Depending on your needs, there are several optional coverages—or endorsements—that you can add to a standard boat insurance policy. For example, agreed value coverage allows you to set a payout value for your boat in advance, avoiding disputes over depreciation if it’s totaled. Anglers can benefit from extra protection for fishing equipment, and those in hurricane-prone areas may want a haul-out endorsement to help pay for moving the boat to safety ahead of a storm.  

You can also expand your navigation limits, add mechanical breakdown coverage, or get coverage if you display your boat at shows or rent it out occasionally. 

How Much Does Boat Insurance Cost? 

The cost of insuring a boat can vary widely based on several factors. The type of boat, its size, horsepower, age and value all play a role, as do the materials used and any custom features.  

How you use your boat is another key factor—a vessel used only for occasional weekend recreation poses a different risk than one chartered out for paid excursions or used for competitive racing. Where you operate the boat—such as inland lakes versus coastal waters—also affects your premium, as does how and where the boat is stored during off-season months. 

Your boating experience matters, too. Insurers often consider how long you’ve been boating, whether you’ve taken any safety courses and even your driving and claims history. A clean record can work in your favor, while previous claims may increase your premium.  

You’ll choose your deductible and coverage limits when selecting a policy. These choices impact your monthly cost and how much you’ll pay if you ever need to file a claim. Optional coverages and endorsements add to the cost but can also provide essential protection tailored to your situation. 

How to Get Appropriate Coverage 

Your agent can help evaluate your needs, review your options and build a policy that fits your lifestyle and budget. If you’re unsure where to start or have questions about what coverage makes sense for your situation, reach out to Sanford & Tatum, An Alera Group Company for help navigating your coverage options.

© 2025 Zywave, Inc. All rights reserved. This Know Your Insurance document is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.