Insurance Concepts (Tuggers Vol 65)

2015 Insurance Survey Results

Phil de l'Etoile, Brave Duck 37VT67

(Presented at the NW Rendezvous 2015)

Member	Boat Name	Carrier	Liability Limit	Physical Damage	Annual Premium
de l’Etoile (Revised)	Brave Duck	BoatUS	$500K	$100K $130K	$981 $1,230
-	-	Allstate	$500K	$150K	$939
Steplock	Pet Tug	State Farm	$300K	$140K	$813
White (Revised)	Renegade	ACE	$300K	$190K $150K	$1,486 $1,100
Hildahl	Awesome	Allstate	$300K	$150K	$1,207
-	-	BoatUS		$190K
Stage	Titan	BoatUS	$150K	$150K	$1,956
Dann	Cielito	Lloyds	$500K ?	$140K	$1,150
Yano	Tugboat Annie	BoatUS	$500K	$175K	$1,061
Howell	Nellie D	Progressive	$300K	-	$247
Blackwood	Thistle Dew	BoatUS	$500K	$140K	$1,453
Rothert	Lady	BoatUS	$500K	$165K	$1,650
Lawrence	Raven
Kurath	Annie	BoatUS	$500K	$156K	$1,702

   de l’Etoile Boat Value Annual Premiums: 

  $100K = $981, $125K = $1,196 ($215 Increase), $130 = $1,230 ($249 Increase), $150 = $1,356 ($375 Increase),  Liability Only = $477 ($500K)

Insurance Concepts

Insurance is intended to cover unexpected losses that you cannot afford. 

• The premiums for Umbrella layers are generally lower than premiums on Primary Coverages. IOW, the top $200K in a $500K underlying policy (Auto, HO, and Boat) is more costly than the bottom $200K in an Umbrella policy.    

• Physical Damage coverage (Hull) is normally the largest chunk of our Boating insurance premiums . - usually at least 50% or more. 

• In some lines of coverage, a total loss is not the norm.  So a 50 or 75% insured value might seem to make some sensebecause of the lower premiums involved. However we know that it doesn't take much to "total" an Automobile these days, so under-insuring your car doesn't make much sense. Boats are pretty much the same because a boat that sinks or a boat that catches fire may easily result in a "total" the vessel. 

• So when it comes to boats, an accurate value on the hull is probably the best policy. The term "accurate" can often behard to determine however. Maybe the question really is, "What amount is reasonable?". The question is not "What's the maximum amount that I could ever get for my very beautiful boat?". Don't forget that when selling your boat you have to consider that brokerage commissions, endless haggling, moorage fees, and survey fixes and correctionswill reduce your asking price. An Insurance settlement has none of these.

• Comparing premiums can be tricky. There are variations in territory, loss history, and policy limits and coverage that come into play.

• You must decide what Claims are really worth reporting. There's an expression in the industry: "Frequency Breeds Severity". That means that if you file 2 or 3 small claims, it is expected that soon you will have a big one. That's also the time you could possibly get dumped. 

So it’s probably best to not plan on trying to get so much of your premium money back as possible by claiming every little, incidental loss.

Beware: Insurance carriers that spend big bucks on advertising will most likely be hard to deal with when it comes to settling claims. Insurance companies have only one source of revenue and that's premiums. Generally 20-30% of their collected premiums is a good estimate for normal insurance company expenses. That includes overhead, and profit. The rest is to pay claims. 

If you see an insurance company paying for expensive Super Bowl ads or other regular TV shots, or glossy magazine ads, penny pinching claims are the only way to offset those extra high expenses.  

Especially beware when these same carriers promote "Low Premiums". Ask yourself how that can possibly work out well. In addition to having high advertising expenses, they are now also reducing premiums. 

I know of a body shop that hates to handle claims for a certain low premium, highly advertised company.  The carrier is always looking for after – market parts, or not wanting to replace parts that can salvaged in some way.

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