There still seems to be some confusion about exactly what types of insurance are required when you charter a bareboat and I’d like to take this opportunity to write about the various types of insurance available and exactly what they cover. Hopefully this article will help our clients to understand what they are being charged for and what is mandatory and what is optional. Let’s take them one by one:
1. Damage Insurance: All operators and owners take out insurance on their fleet of boats that covers major damage to the boat, including capsizing and sinking. In a nutshell, if you hit something or damage anything on the boat the owner / operator is covered and gets reimbursed by the insurance company.
There is, however, a deductible amount that needs to be paid by you, the charterer. The amount of the deductible that you are liable for can vary with each boat and each operating company and most companies will charge you a daily “insurance rate” to minimize your liability. In some cases this is optional and in others it is mandatory.
One operator, for example offers two options, pay the daily rate of about $50 and your maximum liability for damage will be $850 dollars (or Euros or whatever) or if you choose not to take out the insurance package, your liability will jump to $6,500.
To insure payment, an imprint of your credit or debit card will be taken at the base and your card will be charged to the extent of the damage. Other companies, like the Moorings and Voyage Charters for example make this insurance premium mandatory so you won’t get a bill at the end of your charter that could cripple you financially. Our recommendation, in cases where damage insurance is optional: take it.
2. Third party liability insurance: all bareboats and crewed yachts are substantially insured for liability claims against them. So, if one of your charter party slips and falls or has an accident while you are skippering a charter vessel, the operating company and the owner are pretty much covered.
If you are concerned that one of your charter party could sue you personally, as skipper, for a real or perceived negligence, you should take out a separate policy with your own carrier or have your guests sign a waiver that protects you from a lawsuit.
3. Trip Cancellation insurance: also known as travel insurance, is offered by some operators such as the Moorings, Sunsail, Voyage, etc. Sometimes it’s given a sexy name like “Charter Care Protection Plan” and in some cases it will be mandatory when you book the boat but you can opt-out after you have booked. Actually it’s a pretty darn good thing to have because it essentially protects you from several things like:
– Named storm cancellations
– Flight Cancellations or delays
– Charter cancellation by the charterer (client) or other people in the charterers party for a ” good reason” (like loss of job, illness, etc)
– Trip cancellation “for any reason” may be purchased at extra cost and with a substantial deductible
– Medical expenses in case of accidents
Certainly, we as a brokerage company highly recommend that you purchase trip cancellation insurance. For more details, check out the Travel Guard CHARTERIS online insurance quotation and purchasing system.