Insuring Your Boat for Hurricane Season

The Atlantic hurricane season began officially on June 1st and ends November 30th. The Eastern Pacific season started on May 15th and also runs through the end of November. The National Weather Service is predicting 12 to 18 named storms across the Atlantic basin, of which 6 to 10 could become hurricanes. NOAA is predicting similar numbers for the Eastern Pacific season.

If you live in a hurricane prone area and own a boat, you need to think about making a Hurricane Plan. Most insurance companies that still insure boats in Florida require a Hurricane Plan and some actually make it a warranty in the policy if you want the “wind” coverage.  Remember, most if not all yacht policies contain a Named Storm Deductible of 10% of the Agreed Value. For example, if your boat is insured for $250,000, the hurricane deductible is $25,000. Some companies will reduce that storm deductible to as low as 5% or even 3% if you actually implement your hurricane plan and save the boat from damage. In other words a little risk management goes a long way!!  Insurance is not meant to produce a profit for the boat owner, and nobody wins when a loss occurs.

If you want to learn about what you can do to manage your risk, there are lots of sources on the internet.  A list of actions that should be taken is provided by Global Marine Insurance Agency. In addition, Boat/US offers some great tips that if implemented have proven to substantially reduce or negate any damage from Class 4 storms. Florida marinas have done a good job of building “hurricane proof” buildings and there are lots of Hurricane Clubs around that can be very effective in protecting your boat. Most yacht policies also include a Hurricane Preparation coverage up to $1,000 which pays to move the boat or prepare it for the storm. Ask your agent for details.

After Hurricane Andrew in 1992 and Charlie and Frances in 2004, the marine insurance industry lost most of its appetite for boat, dealer and marina coverage in hurricane-prone areas. Andrew was the trigger for companies to require Named Storm Deductibles and the rates went up dramatically afterwards.  Developing your own Hurricane Plan will reduce your deductibles, help the industry keep rates low, and help us all continue to enjoy boating.

Mike Smith

Mike Smith

By: Mike Smith

Executive Vice President

Global Marine Insurance Agency

Global Marine Insurance Agency is solely dedicated to providing insurance coverage to members of the boating community.  Let us help you protect your investment.  Get an online quote today…