Storm-Damaged Boats, Part 2: Untangling the Mess

What happens to storm-damaged boats? The initial answer depends on if you have your boat insured and the particulars of that policy. I’ll discuss what happens to storm-damaged boats down the line when they may be resold, but for now, let’s start by assuming your boat is storm-damaged and you have no coverage. Do you realize that you may be personally liable for salvaging your boat and paying associated costs and/or fines for fuel leaks and other hazards to the environment? Which is why, for those choosing insurance, you’ll want to pay particular attention to the “salvage” portion of the insurance contract.

storm-damaged boats
Over 100,000 boats were damaged across 19 states by Hurricane Sandy alone. Will you end up owning one? And how will you know?

I’ve been speaking with members of BoatUS’s Catastrophe Action Team, or CAT, to help me understand the intricate world of disaster recovery specific to boats. (See Storm-Damaged Boats, Part 1.) BoatUS insures over two million boats in the U.S. and since they mobilize for major storms they have a unique perspective. To quote CAT team member and BoatUS’s Director of Technical Services, Beth Leonard, “It is not for the faint of heart.”

They start by assembling a diverse group of subcontractors, from marine surveyors to transportation and logistics folks, as well as their own claims administrators, to dig through the piles of damage, literally and figuratively. At first they can’t tell an insured boat from any other and often they begin by providing a marina owner a salvage plan for all the boats that had been on their property. The CAT team is routinely on location for weeks on end, with no power in the community , surrounded by people dealing with catastrophic loss.

Once the boats are recovered from their far-flung storm-tossed destinations, they are identified, tagged, and examined for damage, and a report is written. Surprisingly, BoatUS was writing checks to some policy holders within a week of Sandy coming ashore in the mid-Atlantic states.

At this point, it should be pointed out that boat owners need to be able to prove ownership post-storm. Think about this for a minute:  All your paperwork proving ownership may be gone, as well as your home. In some cases boats are still missing — sunk or never located. In order for the insurance company to pay off a total loss, they will need to gain ownership of the boat and be able to transfer clear title. Being proactive and storing records and pictures safely, like in a safety deposit box, may save much trouble down the road.

Boats deemed a “total loss” may still be worth something; it’s just that the “agreed-on value” listed in the insurance policy is less than the estimate to repair the damage. For example your boat is worth $50,000, your insurance coverage has an agreed value of $25,000, and the damage is estimated at $35,000. The boat is totaled for insurance purposes, but, in this case, boat owners may buy back the boat  at a negotiated price (presumably less than $15,000  in this instance) and have it repaired themselves, or they are paid off completely and the boat is assigned to a “liquidator”.

Boat liquidators are something like a consignment shop. BoatUS gets a percentage of the money to defray their costs when the boat is finally sold or parted-out. The hard part for all concerned with storm-damaged boats is that there is no equivalent of a Carfax in the boating industry at this time, meaning that you don’t always know if you’re buying a boat that has been damaged. A case in point from Sandy: one of the boats was identified by a surveyor as having been previously damaged in Katrina. How it got to the mid-Atlantic coast from New Orleans is still a mystery. Read about how to avoid buying storm damaged boats.

Next blog I will talk about the national boat liquidators,  how to contact them and look at their inventory.  I’ll also discuss potential advantages to buying a storm-damaged boat.

Preparing Your Boat to Sell: Winter Work Is Worth It

Staging your boat to look great, even if you have to hire someone else to make it shine, is essential in making your boat sell quickly for top dollar.

Hopefully you’ve winterized and covered your boat by now. As temperatures drop, your hopes of selling your boat may also be depressed. The good news is that winter is a great time to prep your boat to sell.

While watching a real estate show on TV’s HGTV the other day, it occurred to me that prepping a house to sell isn’t much different from prepping a boat for sale. In either case, a soft market requires effort and possibly a small investment on your part to make your property shine and sell quickly. Most people aren’t interested in making even a small investment in a boat they’ve decided to sell—and this could be a mistake.

While I can appreciate the sentiment, the reality is you may never sell your boat at your asking price if there’s better competition. Boatyards are desperate for work right now and you may get a good deal on preparing your boat for sale on anything from repowering to detailing. Even if you choose to do the work yourself, now is the time to organize and tackle those tasks that will make your boat sell. So, here are my tips on getting your boat to sell quickly with apologies to HGTV for borrowing their message that works so successfully for selling houses, too.

Fix the problems: Ask yourself, “Would I buy a boat with these problems, and if the answer is yes, at what discount?” The benefit to fixing the problems is more confidence during negotiations. People don’t want problems, they want a good, working boat! Most sensible people are going to hire a surveyor to go over your boat with a fine-tooth comb before buying and these problems will be brought to light. So why not eliminate them now?

Stage the product: Make your boat shine:de-clutter, de-personalize,and organize equipment. Get rid of those rust stains. Organize your chart table. Finally, prepare a binder with equipment lists, warranties, and work records (even if you do it yourself) that you can hand to a prospective buyer to make a good first impression. Small defects that attract unwanted attention make people subconsciously think, what else must be wrong?

Adjust the price: Do some research online to see what similar boats are selling for now. has a good step-by-step guide on the pre-sale and sale process, including how to price your boat with the help of the NADA Guides. Price your boat realistically, and remember, if everything is not pristine and in working condition, be prepared to discount.

Get the word out: Take photos, establish equipment lists, and post your boat for sale on bulletin boards, websites, Facebook, Craigslist, and with a broker if necessary.  More eyes on your ads means a greater likelihood of finding a buyer.

A little organization and effort during this winter will pay dividends when your well-prepared boat sells for top dollar.