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ContinuousWave: Post-Classic Whalers
Insurance Value of Boat, Motor, and Trailer
|Author||Topic: Insurance Value of Boat, Motor, and Trailer|
posted 02-08-2010 09:16 PM ET (US)
I was adjusting the insured amount on my boat policy. It was $19,000. My wife asked if we could lower that to cut costs. I figured we could go to $15,000. The insurance agent came back with values on the boat, motor trailer to total $15,000. They suggested $8,950 for the 1996 Outrage 17 II, $5,000 for the 1995 Mercury 150-HP motor, and $1,050 for the Eagle single-axle trailer. I guess the trailer sounds about right, but what would CW'ers suggest on the boat-motor split? I was thinking more on the boat, less on the motor?
Everything was bought new in 1996 and boat is in perfect condition stored mainly indoors and always indoors for winter. Thanks in advance.
posted 02-09-2010 11:07 AM ET (US)
If you are in the USA, east or west coast? Location would make a difference of a couple of thousand.
posted 02-09-2010 03:48 PM ET (US)
Apparently you are not a BOATUS member or have insurance with them but I'm pretty sure you can go on their website and get an estimate for free. I am a member now but did this years ago before I became a member and insured by them.
It might also be worth your while to get a quote from them too plus others. Not sure who you have, but I found it amazing the difference in costs between companies. I think you'll find you don't save too much by dropping the value. Another thing you should ask your company is whether they would give you book value, or an agreed upon fixed value if a total loss. If book value, you are wasting your money over insuring it.
posted 02-09-2010 04:30 PM ET (US)
I can't believe a 1996 Mercury 150 is worth anything near $5,000. Ask the insurance agent if that's really what they'd give you if the motor fell off in deep water and couldn't be recovered.
posted 02-09-2010 06:36 PM ET (US)
Thanks for the replies--I am in the Chicagoland area. I wasn't really too worried about getting the rock bottom cheapest insurance but rather fairly apportioning the values of the package accordingly. I quoted BoatUS once before and they didn't offer any savings.
If I were to sell [the boat, motor, and trailer as a package], $15,000 total seems like a good guess. Of course it's worth much more than that to me so it's not for sale, but no reason to over-insure it either.
I thought the $5,000 sounded high too, what do you think about $2,500 ~ $3,500 there?
posted 02-09-2010 11:35 PM ET (US)
Actually the numbers seem good all the way around and are in keeping with replacement values - I'm sure you have a deductible as well (probably $1,000?).
You are most likely insuring against loss or damage so you can offset replacement costs so those are good numbers for the value of the items listed - in all likelihood if the hull goes (stolen or loss at sea) the motor will go with it so you get full 14k value, but if only the motor goes, either you sell the hull - which $9,000 for a 14 yr old powerless hull is a bit much IMO - or you replace the motor and that 5 Grand will be mighty useful for that purpose toward that end.
If you are not worried about covering loss/damage or replacement why carry the coverage at all, right? I think your Agent is giving you a reasonable value estimate and is truly looking out for you with those values for coverage.
My two cents -
posted 02-10-2010 06:51 PM ET (US)
I would suggest that whatever amounts you settle on, make sure the policy is a "stated value" policy. This essentially underwrites the values at purchase. At the time of claim you don't have to worry if your blown engine will be "adjusted" for something less than $5,000 or whatever amount you decide. If it is stolen or "totaled" by the carrier, you will receive $5,000.00, nothing less.
As an aside to deductibles, I have found that there is not a huge savings on these policies in raising the deductible really high. I'm sure it depends on the carrier and simply look at all the options. Eyes wide open, as it were!
posted 02-10-2010 07:25 PM ET (US)
hauptjm - excellent point on ensuring 'stated value' coverage.
posted 02-11-2010 02:01 PM ET (US)
That's the term I could not think of in my post above. Not realizing what I had, I got the "Boat Savers Policy" for my 170 Montauk from BOATUS and then found out later they would only give me "book value". I then qucikly changed to their "Yacht Policy" which carries a "stated Value" for replacement. I think is was an additional $15 or $20 annually.
posted 02-11-2010 02:15 PM ET (US)
You will be hapier with what is stated if your engine catches a bag and blows up. You would be lucky to get $2500 for that motor. If the whole package gets stolen or burns, who cares how it is broken down.
posted 02-18-2010 09:18 PM ET (US)
Insurance office replies: "I am not sure what you are asking. Your policy will pay for a loss at Actual Cash Value up to the amount stated on the policy."
That's not a 'Stated Value' policy then, correct?
posted 02-19-2010 09:29 AM ET (US)
No! This type of policy will determine the value of the component at the time of claim. The "underwriting" will occur at that point. They will determine what percentage damage/lost was in incurred and then mitigate your loss/payment based on what 'they' say its value is at that point in time. This leaves the consumer at the mercy of the carrier to value the asset. Stated Value policies do this underwriting at the point of policy purchase. Simply stated, you tell them what you want to value the component at, and they tell you what the cost will be. If their underwriters feel you're overpricing your component, they won't offer a premium or make it cost prohibitive.
In a way, it's like life insurance: you don't wait until you die to determine what you are worth. Although, I know a few folks that may be over valued.:)
|L H G||
posted 02-19-2010 02:08 PM ET (US)
I am in insurance, and insure a lot of classic Whalers, some for people on this website. I think Jim Haupt is mis-using the term "Stated Value" and considering it as "Replacement Cost" coverage, as I know of no carrier that will do that. The correct term is "Agreed Value", and even then only a few companies will "agree" to that.
What it means is that you give them a "value" of what you think your classic boat, engine and trailer are worth, and they will "agree" to insure for that amount. BUT, at claim time, YOU HAVE TO PROVE your value if it seems out of line.
As for engines, the NADA values are often very low, and an engine will sell for more on the market. In order to collect your "Agreed Value", you will have to show what engines like yours are going for on the various websites, dealerships, etc.
In this model, only insure for what you can reasaonable prove on your rig's value. Otherwise you will be paying premium for something you can't collect. Engine values in particular should be adjusted downward on a regular basis, particularly if you bought them new. If I paid $15,000 for a new Mercury Verado, and insured it for that amount under "Agreed Value", that does not mean that 4 years later I could collect 15 K for it if stolen. I could only get waht a 4 year old engine in similar shape would sell for on the open market, so I should have adjusted my purchase price downward as the engine aged and accumulated hours. Full "Replacement Cost" coverage does exist in the boat world, only in the regular property world.
As an example, I have a couple of 1985 Mercury in-line 6 115HP "towers" on one of my Whalers, which are in beautiful running condition. NADA values them at a ridiculously low $500 each. I could sell 1000 of them all day at that price! Instead, I have them insured on an "Agreed Value" basis for $3000 each, about the most they may be worth to someone particularly insterested in one of these classics. That is an amount I could establish fairly easily.
posted 02-28-2010 10:13 PM ET (US)
I apologize if I used an insurance term incorrectly, but I'm simply going on practical experience. Progressive Insurance (and my marine insurance agent with over 40 years and many, many $$$ in force), used that nomenclature.
My experience has not been what LHG describes. The few claims I've made were always paid at the limit amounts described in the policy. Once the determination was made that the engine was "totaled", I was paid the "agreed" amount. The engine was 5 years older than when I set the amount with the carrier.
Now, when we set the limits, the amounts have to be justified. I don't believe a carrier would "agree" to insure a 2000 150hp motor for $10,000. As an aside,the values we agreed upon were separated by Boat, Motor and Trailer, each having it's own assigned value.
Again, this is my experience only, and everyone should explore what is available for their circumstances and checkbook.
posted 03-01-2010 04:51 PM ET (US)
I just got off the phone with my State Farm agent. I was inquiring about the type of boat insurance that I had and I asked him specifically what they would pay if my boat was stolen or a total loss from an accident. I was pleasantly surprised to learn that they would pay the amount shown on the policy at the time we established the policy. And he referred to the policy as "stated value coverage".
I told him that I was surprised because current market conditions would not justify the price they would pay (although it wouldn't be nearly enough to replace my boat with a new one).
A few years back I went through quite an ordeal getting State Farm to pay me what I thought my Mustang GT was worth when it burned up in a fire.
He said that their boat insurance is COMPLETELY different than their auto policy.
I can lower my premium if I want by accepting a lower limit.
I don't mind sharing this info:
Currently my policy is:
boat, motors, equipment.....$29,000
posted 03-01-2010 06:46 PM ET (US)
I forgot to add, the policy I own is indeed an "agreed value" not a stated value policy. After calling my agent, he said I know what you wanted and many times we use the terms incorrectly. There is a definite difference between the two. Thanks to Larry for clearing that up. As I said, spend the time to get the right policy. However, my settlement was not "adjusted down" one bit.
posted 01-20-2011 12:28 PM ET (US)
Hey DBOutrage - I think those estimates sound about right. Right ballpark range at least, depending on what state you live in. I'd suggest checking out http://www.boatinsurance.org for more info - good site with unbiased info so you know exactly what you should be getting. Hope that helps mate.
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