Boat Insurance

[markm]

Every year I fight with my insurance company (USAA which is handled by Progressive) on the value of my Classic R-21. They clain it is worth only 18,500. I have it covered for 39,000 and 3,000 for the trailer. My boat is wonderful condition. It was new in 2005 and was the last classic from Ranger before the 21-EC. Is is worth fighting with them over this? How do I determine a fair market value for my boat.

Thanks

Mark

 

[SlackwaterJack]

Hi Mark,
Your boat's value may be different due to the custom, extended height of it's pilothouse, so it's value may differ.
I insure my '05 for $20k and the trailer for $4k. I feel the odds of loosing both are very slim (hardly ever towed except to launch 2 miles away). The trailer sits in my sideyard empty for long stretches of time (it hasn't had the boat on it for 14 months and won't for another 6 months at least). Also, the probability of boats like our R-21's being total losses is fairly small given our less crowded, and fresh water locations and our slow speeds.. As far as theft, around here that's not much of a concern, While it is definately a curiosity magnet, around these parts if it doesn't do 40mph nobody will lust after it enough to steal it from the slip. I maintain liability coverage (around $200k).
Of course folks that tow and launch their boat a lot, especially to locations that they are unfamiliar with, may want to load up on coverages due to the highway exposure and it sitting on the trailer in places other than home.
I'm fairly confident that if I had to replace both boat and trailer due to a total loss I could find a nice set for around $24K. You would need to factor-in some custom fabrication $$ if you wanted to extend the height.
It's important to make sure your insurance co understands that your boat is a diesel engined, small horsepower, low speed boat (they often have trouble grasping the concept). The tendancy is to lump you in with the 21 foot jets with twin V-8's, so you'll need to make sure they treat you more like a sailboat. Last year my annual premium came to about $160 through Mutual of Enumclaw (bundled with home and 3 cars).
Determining market value is usually as simple as finding similar boats for sale on places like Yachtworld and Boatrader and the listing on Tugnuts. I don't think trying to increase the value due to it being the last of a series is going to work. I'd go for the compareable value plus maybe the cost of custom work.

 

[John Shea Jr.]

I have USAA for all my insurance needs other than boat insurance. Year before last USAA said they were no longer going to insure boats. That year, based on their reference, I insured with Foremost. I have since(last two years) insured through NBOA and have been satisfied with coverage amounts and policy cost. I pay a $25 menmbership fee but have found their policy costs to my liking. You might want to investigate. Good luck.

 

[thataway]

I also have all of my insurance with USAA (and have for over 40 years)--except the boats. It is much easier to deal directly with what ever insurance company--and thru a marine broker, if necessary than USAA,--and not any more expensive, since USAA subs boats out.

If there remains any question about the "Agreed value", then get a value marine survey. Not as expensive as a hull and condition and should establish the value.

 

[markm]

A marine survey seems like a good idea. Can I get it done here in Spokane. I am 300 miles from Seattle. A long haul, but it might be worth it. Any suggestions.

Thanks for the advice.

Mark

 

[abcandjrc]

We insure with Boat/US. They will write an "Agreed Value" policy which does not depreciate the boat itself. There are some provisions to depreciate personal equipment on board, but the hull and machinery are covered up to the limit of the policy. There is a relatively small premium increase for that type of policy but it assures that a person who does exceptional maintenance and upgrades will be able to replace his boat with one of equal value in the event of a loss. In effect, they are insuring against a fixed (limited) amount of loss of wealth, not the loss of a boat with diminishing (market) value. I believe most marine underwriters will issue a similar policy, so check around and get some quotes.

To us, it is well worth the amount we had to add. Again, there is a Boat/US membership involved but they do produce a nice magazine. There is a discount program based on accumulated purchases at West Marine included which might be of value.

A survey might be of value, but remember that most surveys will value a boat at the value of the average vessel of its age and type, and on "book values". That means that exceptional vessels will be priced about like the average. Also note that we had a 1200 pound diesel fall into the bilge of our Atlantic 44 within 200 miles of a pre-purchase survey during which the (certified) surveyor failed to notice a few missing bolts. Obviously, Caveat Emptor applies to boats and to surveys.

(I sure wish I could find an equivalent policy, even a supplement, for our 2001 F-150 which currently has 38,000 miles on it. Except for the design changes it is equivalent to a 2 or 3 year old version, and better in some ways since I maintain it myself and have done some upgrades. But my insureer will pay about $7,000 if totaled, and will total it quickly if any major-but-repariable damage is done to it. That would put me out about $10,000 or $15,000 to replace it with an "equivalent" truck with a questionable history.)

 

[NewMoon]

Ours is insured with Progressive. No hassle about the agreed value, and far less expensive than any other quote.

 

[abcandjrc]

I want to caution that some may misunderstand that "the agreed value" is not necessarily the same as an "Agreed Value Policy". It is easy to think "the value my insurance company and I agreed on" translates to Agreed Value coverage, a specfic underwriting definition. The actual policy should specify the type of coverage as "Actual Cash Value" or "Agreed Value".

Progressive does (and most marine underwriters will) write both types of policies. Progressive defines them very well this way on it's web site (emphasis mine at the relevant points):

Actual Cash Value: With Actual Cash Value coverage, we pay either the market value of your boat/PWC at the time of the loss or the Rating Base—whichever is lower. (The Rating Base is the dollar value you originally provided us for your boat or PWC to reflect its current market value.)

Disappearing Deductibles coverage is available for additional premium.

Agreed Value: With Agreed Value coverage, we pay the agreed value of your boat—an amount you previously chose and to which we agreed—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 (for newer boats), an ABOS, BUC or N.A.D.A. appraisal guide or an accredited marine survey.

Agreed Value coverage includes Disappearing Deductibles coverage and is not available for PWCs.

 

[bluebayou]

Thank You, abcandjrc.
Everyone should read the previous definitions, if they have any doubt.
One CAN have a Policy that, in the event of a total loss, provides more than the "market value" of other similar boats.
The premium might be larger; but if, for example, your late model Ranger Tug is stolen and wrecked, you could get enough cash back for one in equal condition.
Homeowners' policies have had "Replacement Value," as opposed to Actual Cash Value, for a long, long time.
Similar concept: If your house burned down (unlike a boat, a thief can't steal it and motor away), you'd want a new one built, not just the used value of your old house.
I have recently seen commercials for auto insurance, where they offer you a new car, if your used one is wrecked.
You get what you pay for, and you do need to read the Policy, as dull as that may be.
I vote for Agreed Value in boat policies, unless your boat is very old and worthless.
More important, have high-value Liability limits, and possibly an Umbrella Policy above the boat liability limits.
What you lose when your boat is wrecked, in the boat's value, is but a drop in the bucket of what you can lose if you are the responsible party, and people are maimed or drowned, and your boat hits another, larger boat.
Charles (former insurance advisor, can you tell?)