The yacht and marine insurance landscape is complex and dynamic. While the reality of today’s insurance marketplace can feel overwhelming to boat owners and buyers, there are smart ways to navigate your options and secure the yacht insurance coverage you need.
What’s driving capacity limitations in the yacht insurance market?
The dramatic increase in boat purchases back in 2020 and 2021, during the height of the pandemic, significantly impacted not only the marine supply chain but also the insurance market and underwriting parameters. Many of these impacts and changes to the marine industry and insurance market are still a reality as we enter the 2024 boating season. Most of these market shifts are here to stay.
The increase in demand for yacht policies, along with year after year of record-breaking climate-related disasters and frequent severe weather events, have put substantial pressure on an already competitive, restricted marine insurance market.
Advanced technologies that are integrated into marine construction, materials, rigging systems, and onboard electronics have created new and ongoing challenges and complexities for underwriters. Marine insurance capacity from the carriers, which means the availability of yacht insurance policies, continues to be limited across the nation, especially in areas vulnerable to increased hurricane and severe weather activity such as Florida, Texas, the Gulf States, and California.
What can a yacht owner or buyer do to secure insurance for yachts in this competitive, restricted marketplace?
The two key factors to securing yacht insurance in this competitive, complex insurance market are:
- Submitting a strong, attractive application to insurance carriers
- A well-prepared application and submission demonstrates your professionalism, marine experience and knowledge, attention to safety and seamanship, and a commitment to risk management, all of which can help build trust with insurance carriers and strengthen your relationship with them in the long run.
- Ultimately, taking the time to submit a comprehensive and compelling application can lead to more favorable insurance terms and coverage options for you and your yacht.
- Working with an experienced marine insurance specialty broker offers significant advantages in the maritime insurance sector.
- These brokers have a deep understanding of the unique risks involved in boat ownership, understand navigation plans, and are skilled in designing insurance solutions tailored to fit your yacht and nautical lifestyle.
- They use their industry knowledge and carrier partnerships to secure comprehensive coverage at competitive prices and can provide essential support in marine claim situations.
What are the 10 key elements of a strong boat insurance submission?
It is helpful to have a clear understanding of what makes a risk most attractive to an underwriter. In nearly all cases, the underwriting company wants to know that you and your boat are a good, safe risk. Underwriters scrutinize each risk and expect detailed background information to accompany each application. Boat owners should work with their insurance broker to determine which of the following supplemental materials are needed to make for a strong, attractive submission for marine insurance.
- Boating Resume – Detailed boating experience (owned and operated), licenses, certifications, safety training, expertise areas, etc.
- Prior Boat Ownership – List of similar-sized or larger yachts, with dates of ownership and navigation areas (if no relevant prior ownership, a captain may initially be required).
- Paid Captain Resume (if applicable) – Detailed account of the captain's professional experience, along with a history of insurance claims.
- Paid Crew Resume(s) (if applicable) – Detailed resume of all paid crew including professional experience, applicable navigation and safety training, and claims history.
- Accredited NAMS/SAMS Marine Survey (less than 3 years old) – Including confirmation of survey recommendation completion.
- Hurricane/Storm Plan – If boat will be in areas prone to hurricanes or severe weather patterns.
- Absentee Owner Plan – If boat will be left unattended for periods of time.
- Maintenance Service Records – May be needed in the event of a claim or if an insurance company asks for proof of improvements.
- Boating Safety & Claims Records – Helpful in the underwriting process.
- Personal Insurance Portfolio (homes, autos, valuables, umbrella) – Can be helpful when considered as part of a packaged submission with your request for marine/yacht insurance.
Working with a specialized marine insurance broker can make a big difference
An experienced marine insurance broker can help a boat owner or prospective owner work through most challenges to secure adequate, comprehensive insurance for their boat and other assets. The marine insurance broker will advise the boat owner on which supplemental materials are needed to support their insurance application and can often provide templates to facilitate the creation of these materials. Boat owners and buyers should seek out a broker who is active in today’s dynamic marine insurance marketplace, has strong relationships with marine insurance companies and underwriters, and has access to a wide range of marine insurance solutions.
The broker should be well versed not only in risk management and insurance placements, but also knowledgeable about a wide range of boat types, marine electronics and technologies, marine construction, cruising plans, racing schedules, safety equipment, navigation areas, and hurricane zones. Timing also matters. Boat owners and prospective boat owners should connect with a specialized insurance broker very early in the boat-buying process to allow for ample time to secure the best insurance solution possible.
Marine specialists at Risk Strategies
The marine specialty division at Risk Strategies includes deeply experienced marine insurance advisors, including experts who joined the team through the acquisition of long-time marine specialty brokerages Gowrie Group and Atlas Insurance. Our marine specialists are uniquely able to help boat owners and prospective owners navigate the process of securing yacht insurance in today’s complex, competitive market.
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