Boat and Watercraft Insurance: What You Need to Know

Aug 1, 2023

Modern boats moored in front of a Martello Towers in Kingston, Ontario, Canada.

Boating offers unparalleled freedom, adventure, and connection with nature. Whether it’s a leisurely sail on a serene lake, an exhilarating jet ski, or a fishing trip in a canoe, all shapes and sizes offer a unique experience. Owning and operating a boat comes with the responsibility to protect oneself and others.

Boat and watercraft insurance covers you in case of loss or damage to your boat. It covers most watercraft with motors, including fishing, pontoon, paddle, leisure crafts, jet skis, and yachts.

Insurance for your boat or other watercraft is about protecting your investment and securing peace of mind. Whether you’re a weekend sailor, an avid angler, or someone who enjoys cruising open waters, boat insurance is a critical aspect of boat ownership that should never be overlooked.

Let’s delve into the nitty-gritty of boat and watercraft insurance, exploring different types of coverages, the factors influencing premiums, tips for lowering your insurance costs, and much more. We aim to help you navigate the sometimes choppy waters of boat insurance so that you can make the most of your time on the open water worry-free.

Different Types of Boats and Watercrafts

Boats and watercraft come in various types, each designed with specific activities or conditions in mind. The type of boat you own can significantly influence your insurance needs and costs.


This category covers many boats, from small powerboats to large cruisers. They are primarily used for recreational activities like fishing, waterskiing, or cruising. The insurance policy for these boats typically depends on the craft’s size, type, and value.


From small, single-person crafts to multi-hulled catamarans or luxury yachts, sailboats are powered by the wind. Insurance for sailboats takes into account factors such as the size of the boat, its age, and whether it’s used for racing or cruising.

Personal Watercraft (PWC)

This category includes jet skis, wave runners, and other similar vessels. Since these crafts are often involved in accidents (due to their speed and maneuverability), insurance policies can be slightly more complex.

Fishing Boats

These boats range from small, superficial outboard vessels to larger, sophisticated charter boats equipped with professional fishing equipment. The type of use (personal or commercial), location (inland or coastal), and the fishing equipment installed can influence the insurance policy for these boats.


Essentially a home on the water, houseboats require specialized insurance that blends homeowners’ and watercraft coverage. Factors such as the boat’s mobility, the age and value of the boat, and whether it’s your primary residence can affect the insurance policy.

The type of boat you own will largely dictate the coverage you need, so discussing your specific requirements with your insurance broker is essential. Remember, the right insurance policy is tailor-made to fit your unique needs, ensuring your peace of mind while you enjoy your time on the water.

Understanding Boat and Watercraft Insurance Policies

Like automobile insurance, boat and watercraft insurance provides various coverage options to protect you, your passengers, and your vessel. Understanding these coverages is crucial for choosing the best policy for your needs.

Collision Damage

This coverage helps pay for repairing or replacing your boat if it’s damaged in an accident with another boat or object.

Property Damage Liability

If your boat causes damage to others’ property, such as another boat, a dock, or navigation markers, this coverage will help pay for repairs or replacement.

Bodily Injury Liability

Should you be at fault in an accident that causes injury to others, this coverage will help pay for costs associated with their injury. This can include medical bills, lost income, pain and suffering, and legal expenses if a lawsuit is brought against you.

Additional Coverage Options

Depending on your needs, you may want to consider additional options such as:

  • Towing and Assistance: If your boat breaks down while you’re out on the water, this coverage will reimburse you for the costs of emergency services, such as towing to shore or delivering gas or a new battery.
  • Salvage and Wreck Removal: This covers the costs of salvaging your sunken or wrecked boat, which can be substantial depending on the location and conditions of the wreckage.
  • Spill Liability: In the event of a serious accident, boats can leak oil or fuel into the water, for which you could be held liable. Spill liability coverage helps protect you against these potentially high costs.
  • Personal Property: This coverage protects personal items on your boat, such as fishing gear or a high-end stereo system.

As you choose your coverage, consider the value of your boat, how you plan to use it, what risks you may encounter, and your comfort level with potential out-of-pocket expenses in the event of a loss. Remember that each policy is unique, so work closely with your insurance agent to customize a policy that best fits your situation.

Factors Influencing Insurance Premiums

Several factors can influence the cost of your boat and watercraft insurance premiums. Understanding these factors can help you anticipate the cost and even identify ways to lower your premiums.

Age, Size, and Type of the Boat

Generally, newer, larger, and faster boats tend to cost more to insure due to higher replacement or repair costs. The boat’s type also plays a significant role. For instance, sailboats may have different insurance costs than motorboats due to their operation differences.

Expected Usage of the Boat

If you plan on using your boat for water skiing, fishing, or racing, you may require additional coverage, increasing your premiums. The frequency of use can also impact your rates. If you use your boat year-round, your premiums might be higher than if you use it seasonally.

Boating Experience

Like auto insurance, boating experience plays a role in determining your premiums. Boaters with more experience may pose less risk and thus could receive lower rates.


Where you plan to use and store your boat can greatly influence your insurance cost. Navigating in high-traffic areas or areas prone to severe weather could increase your premiums.

Claims History

If you’ve filed boat insurance claims in the past, insurers may see you as a higher risk, which could result in higher premiums.

Safety Measures

Implementing safety measures, like having approved fire extinguishers and safety equipment on board, can help reduce your insurance cost.

Understanding these factors lets you make informed decisions and adjust your habits or conditions to lower your insurance premiums. Discuss these factors with your insurance broker to ensure you get the best rates.

The Importance of a Boat Insurance Survey

Just as a home inspection is crucial when buying a house, a marine survey is vital when purchasing a boat – and often required when applying for boat insurance. This comprehensive inspection assesses the condition and overall operational status of a vessel.

What is a Boat Insurance Survey?  

A boat insurance survey is an inspection performed by a certified marine surveyor. It objectively evaluates the boat’s structural and operational integrity, safety features, and estimated value. This evaluation may cover various aspects of the boat, including the hull, decking, engine and propulsion systems, navigational equipment, and electrical systems.

Why is a Boat Insurance Survey Important?

A boat insurance survey provides a detailed understanding of a boat’s current condition and value, which is crucial for both the buyer and the insurance company. For the insurance company, the survey helps assess the risk of insuring the boat. For instance, a vessel in poor condition poses a higher risk, which could impact the cost and eligibility of coverage. The survey can identify potential safety issues or needed repairs for the boat owner, helping prevent future accidents or breakdowns. It also ensures that the boat is insured for its correct value.

Whether you are a seasoned seafarer or a first-time boat owner, a boat insurance survey is a key step in the boat insurance process. It provides an invaluable snapshot of the vessel’s condition, helps customize your insurance policy, and, ultimately, gives you peace of mind on the water.

Tips for Lowering Your Boat Insurance Costs

While boat insurance is a necessary cost for any boat owner, there are several strategies you can use to help keep your premiums as low as possible:

Take Safe Boating Courses

Many insurance companies offer discounts to boaters who have completed approved boating safety courses. These courses could lower your premiums and equip you with knowledge and skills that make your boating experience safer and more enjoyable.

Install Safety Equipment

Equipping your boat with approved safety gear may also lower your premiums. This can include life vests, fire extinguishers, navigation lights, depth finders, VHF radios, and more. A vessel equipped for safety presents less risk for the insurer, which can be reflected in your rates.

Maintain a Clean Boating Record

Like car insurance, a clean boating record – free of accidents and violations – can help reduce your boat insurance premiums. This tells insurers you are a responsible boater, reducing the perceived risk.

Choose a Higher Deductible

If you’re willing to pay a higher out-of-pocket cost in the event of a claim, choosing a higher deductible can lower your insurance premiums. However, ensure you’re comfortable with and can afford the deductible amount you choose.

Lay-Up Periods

If you only use your boat seasonally, consider a lay-up period. Some coverages are reduced or suspended during this time, which can lower your premium. However, it’s crucial to remember that you shouldn’t use your boat during lay-up periods; doing so can void your coverage.

Bundle Your Policies

If you have other policies (home, auto, etc.) with the same insurer, you may qualify for a discount by bundling them with your boat insurance.

Remember, the cheapest policy isn’t always the best one. Always consider the extent of the coverage and choose a policy that gives you peace of mind knowing that you, your passengers, and your boat are adequately protected.

Making a Claim: What to Do in the Event of a Loss or Damage

In the unfortunate event that you need to make a claim on your boat insurance, it’s essential to know the necessary steps to ensure a smooth process.

Immediately Document the Incident

As soon as an incident occurs, document all details while they’re still fresh. Write down what happened, the date, time, location, weather conditions, and other relevant details.

Take Photos or Videos

If possible, visually document the incident. Photos or videos of the scene, damages to your boat or other property, and any injuries can provide crucial evidence when processing your claim.

Notify Authorities if Necessary

If the incident involves theft, vandalism, injury, or significant property damage, it’s important to notify local authorities. They can provide official reports that your insurance company may require.

Notify Your Insurance Provider

Contact your insurance agent or broker as soon as possible to report the incident. They can guide the next steps, including completing a claim form or providing additional information. We recommend having a broker who will advocate for you in case of a claim or dispute. An insurance agent’s primary allegiance lies with the company they represent, not you.

Cooperate and Follow Instructions

It’s important to cooperate fully with your insurance provider and any investigators involved throughout the claims process. Provide any requested documentation promptly and follow any instructions they provide.

Complete Necessary Repairs

Once your claim is approved, work with your insurance company to arrange necessary repairs. They may require you to use approved service providers or allow you to choose your own.

Remember, each insurance provider may have a slightly different claims process. Refer to your policy documentation or speak directly with your insurance agent or broker to understand the specifics. Having the right boat insurance and understanding how to make a claim can ensure that an unfortunate incident doesn’t keep you off the water for long.

How FirstOntario Insurance Brokers Can Help

Selecting the right boat insurance can be complex, but you don’t have to navigate these waters alone. As a leading insurance brokerage in Southern Ontario, we are here to provide personalized guidance every step of the way.

Expert Advice

Our knowledgeable team understands the ins and outs of boat and watercraft insurance. We can explain the different coverage types, answer any questions, and help you understand your policy, ensuring there are no surprises in the event of a claim.

Personalized Policies

We understand that each boat owner has unique needs. Whether you own a small fishing boat, a sailboat, a luxury yacht, or a jet ski, we can help tailor a policy that fits your specific requirements and budget.

Access to a Range of Providers

As a brokerage, we have relationships with various insurance providers. This allows us to shop around on your behalf, ensuring you receive the best coverage at the most competitive price.

Claim Support

If you need to make a claim, we’re here to assist. We’ll guide you through the claims process, liaise with the insurance company on your behalf, and work to ensure a prompt and fair resolution.

Ongoing Service

Our commitment to you doesn’t end once you purchase a policy. We provide ongoing service and support, including regular policy reviews, to ensure your coverage remains suitable as your needs change.

At FirstOntario Insurance Brokers, we’re here to sell policies and build long-term relationships based on trust and satisfaction. You can set sail confidently, knowing we’ve got your back. Contact us today to get started on your boat insurance journey.

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