| Although there is no official standard such as ISO | | | | policy such as is the cover adjusted on the basis of |
| within the yacht insurance industry to guarantee | | | | its actual cash value or a replacement cost? Also |
| complete consistency across carriers, most policies | | | | does the valuation change when the boat reaches a |
| have developed many common denominators. | | | | certain age and if so, when? Often a policy will begin |
| Hull, protection and indemnity, medical payments, | | | | as replacement cost and then convert to ACV as |
| personal effects, uninsured boater's liability, towing | | | | the boat reaches an age such as 10 years old. |
| and emergency assistance and even pollution | | | | To overlook the threat of ice and freezing as |
| coverage have all become accepted as essential | | | | non-critical is all too easy unless you are based in an |
| elements within a policy. | | | | area where it is common fact of life. This outlook can |
| However, as we know the devil hides in the detail | | | | be compared to the homeowner who doesn't' buy |
| and the subtle nuances between seemingly similar | | | | flood coverage because he doesn't live on the water |
| policies can lead to very costly uncovered loss, in | | | | and therefore doesn't see the threat. Too often this |
| turn resulting in an expensive claim on your own | | | | nonchalance can come back to haunt us. More often |
| professional indemnity cover. | | | | than not Ice and freezing is excluded but there are |
| Environmental damage, Ice and freezing, mechanical | | | | policies which have no such exclusions or give back |
| break down, and defense costs are some of the key | | | | coverage based on the berthing standards of the |
| areas that if cover is not adequate can lurk beneath | | | | vessel which provide underwriters with more |
| the surface of a policy waiting to cause such | | | | opportunities to control exposure. In this instance |
| exposure if attention to detail is overlooked. | | | | some policies may not exclude ice and freezing but |
| We live in an age of increase environmental | | | | rather exclude damage resulting from improper |
| awareness and as such the laws designed to protect | | | | winterization. |
| our beautiful planet are now rigorously purposeful in | | | | Finally it is vital to understand the critical difference |
| their intent to hold boat owners accountable for their | | | | between a policy that has defense cost in addition to |
| actions. If you are the owner of luxury sports/fishing | | | | the limit of liability and a policy where the defense |
| yacht in Queensland for example, a minor accident | | | | costs are included within the limit of liability, thereby |
| running aground into one of the local reefs could | | | | diminishing the limit available for settlement by the |
| leave a bill that would leave Richard Branson feeling | | | | cost of the defense. With their still being a lack of |
| slightly worried. | | | | standard here make sure you check each policy |
| Environmental damage is generally addressed by | | | | wording carefully. If the owner runs out of limit often |
| carriers in three different ways. | | | | the only feasible step is to make up the difference |
| Firstly, total exclusion for the damage to the marine | | | | with your PI cover - and this is not good. |
| environment, secondly with a stated sub-limit ranging | | | | Obviously it is important to know all of the coverage |
| from $60,000 to $150,000 and finally a policy which is | | | | differences from policy to policy but each of the |
| 'silent' to the coverage. Obviously the latter is the | | | | above occur in real life scenarios and the difference in |
| most generous as it doesn't exclude or sub limit | | | | one policy over another can have dramatic effect |
| environmental damage, however if the insured yacht | | | | upon the amount of loss covered by any particular |
| is based somewhere such as the more robust shores | | | | carrier. |
| of England, it can be an unnecessary premium. | | | | With the yachting sector having seen many top |
| Possibly the most frequently argued claim in a | | | | insurers merge, sell on their portfolios or even leave |
| carrier's yacht portfolio is almost certainly mechanical | | | | the business altogether across the last five years, |
| breakdown. Although coverage for mechanical | | | | now more than ever an examination of policy and |
| breakdown is by no means uncommon how it is | | | | what lies beneath the surface can prove to be a |
| adjusted varies widely. There is a thin line between | | | | invaluable endeavor when placing business. |
| wear and tear and the unforeseen mechanical | | | | Anything less than a 100% understanding of all areas |
| breakdown. The latter being often being covered and | | | | of the marine insurance policy and how they fair |
| the former more than likely not. | | | | against the vessels risk adversity, could lead to a |
| It is essential to establish the variables within the | | | | somewhat sinking feeling all round. |