Feature Insurance
By admin ~ June 30th, 2011. Filed under: Features.
Covering Your Asset
There’s good news on the storm insurance front.
By Louisa Beckett
While June 1st is the start of the annual hurricane season in the Atlantic Basin, according to the National Oceanic and Atmospheric Administration (NOAA), for the marine insurance industry, it starts around July 1st. In the past, insurance underwriters often required policyholders to move their boats north of the hurricane region by July 1 in order to qualify for storm insurance.
Moving the boat is an impractical solution for many owners, however. “There are a lot of people who don’t want to take the boat back and forth. It’s too expensive,” said yacht insurance specialist Joe Kolisch of Kolisch Marine Insurance in Coral Gables, Florida.
Fortunately, today many boat owners can leave their boats in the South Atlantic and Gulf States during the summer and fall months and still qualify for storm insurance. To do so, however, they must fill out a written “storm plan” specifying where the boat will be berthed and how it will be secured during a windstorm.
“Most of the insurance carriers are requiring a storm plan for yachts 35 feet and over, or above a certain valuation,” said Joe, adding, “Each underwriter has a different form.”
While all boat owners should take the proper steps to ensure their boat will survive a storm, Kolisch advises policyholders to avoid committing to a storm plan they can’t realistically execute. “I say try to be as loose on your storm plan as possible,” he said. “Make sure that what the agent fills out for you is correct.”
Absentee owners like “snowbirds” are required to fill out an additional form designating a responsible party to look after their boat if it’s threatened by a storm. It’s important to pick someone who actually will be there to secure your boat when the time comes; you may want to ask them to sign a contract.
If you do have the means to move your boat, you can still get a better rate on your marine insurance by agreeing to take it north by July 1. Some insurance companies are even beginning to loosen up on the geography.
“It used to be, ‘You have to be north of Morehead City or the North Carolina/Virgina border by July 1,’” Kolisch said. “Now most of the underwriters who will give you a better rate say you have to be north of the Georgia/Florida border.”
When it comes to paying off a claim, Kolisch says the marine insurance industry is in pretty good financial shape right now. “There’s a bit of stability in the market over the last two years, due to lower storm activity,” he reports. He even has been seeing a reduction in the rate charged by some marine insurance companies for wind deductibles.
Kolisch cautions that boat owners seeking to save money on marine insurance should not do it by undervaluing their boats in their policy, however. “Anytime the boat sinks, it’s a total loss,” he said. “If you’re underinsured, you’re in trouble.”
Making a Storm Plan
Before writing a storm plan for your yacht, you need to decide whether your boat will be hauled, secured in a marina or private berth, or moved to a safe predetermined location. Consider the following tips when creating your plan.
• If your boat is berthed in a marina, get the list of hurricane procedures directly from the dockmaster and know your responsibilities.
If berthed at a private dock, coordinate mooring arrangements with your neighbors.
• Inspect your boat’s deck hardware and make sure that all cleats, winches and chocks have suitable backing plates and bolts.
• Make a checklist of all items that will need to be removed from onboard. Stock any tools you will need to remove electronics or other installed items. Estimate how much time it takes to remove and/or secure gear so you can plan accordingly.
• Purchase a second set of mooring lines and extra fenders, fender boards, chafing gear, back-up batteries and anchors. It may be difficult to buy supplies immediately before a storm.
• Make sure that batteries for automatic bilge pumps are fully charged. If necessary, install back-up batteries.
• Keep a folder with all of your boat’s relevant paperwork/information in a safe place off the boat. Include copies of your insurance policy, registration, marina contract and equipment inventory.
• Make a list important telephone numbers, such as your insurance broker, harbormaster, Coast Guard, etc.
• Develop a primary plan and an alternative plan. Depending on the force and direction of the storm, your current berthing location may not always be the safest.
If you plan to move your boat inland, identify in advance:
• Where you are going to take it
• All possible routes to get there
• Potential obstacles, such as bridges, tidal or depth restrictions, etc. Some bridges may be closed for land evacuation. Check with your local marine or law enforcement authorities for further information.
• Plan how and where you will store your boat. Identify the equipment needed to secure it safely in this location. Do not plan to leave your boat on a boat lift.
