Do I Need Boat Insurance in Maryland?

Spring is fast approaching, and it is just about time to take our boats out and enjoy the great outdoors. Fortunately for us Marylanders, we never have to go too far to find a place to participate in water sports. So, as we get ready for the warm months, this is a good time to review insurance coverage for your boat.

In Maryland, there is no state requirement to carry insurance on your watercraft. However, there are other circumstances in which coverage may be required. These include:

When the Boat is Collateral for a Loan: As with automobiles and other vehicles, whenever a bank loans money for the purchase of a boat, they will require you to insure it. In fact, if you finance a boat and fail to obtain insurance coverage or your current coverage is canceled or you allow it to lapse, the lender will force place insurance of its own on the watercraft and include the premium with the loan payment. When the lender obtains insurance, it tends to be far more expensive than if you purchase it on your own. So, if you have a loan on a watercraft, you will definitely need to obtain boat insurance.

The Marina where the Watercraft is Docked Requires Boat Insurance: Another common reason you might be required to obtain boat insurance is if you dock the boat at a marina during the warm months. Many marinas will require you to carry liability insurance on your boat to protect against any damage your watercraft may do to other people or property. Check with your marina to find out if boat insurance is needed and how much liability coverage they require.

Here are a few other things to keep in mind about boat insurance in Maryland:

• Boat policies are similar to auto policies: A boat insurance policy is similar to an auto insurance policy in that you are able to obtain coverage for collision, comprehensive, and liability insurance for bodily injury, property damage, and physical damage.

• Your auto policy may extend to your boat under certain circumstances: When your boat is in the water, you need a boat insurance policy to cover losses that may occur. However, when your boat is being towed by your vehicle, it may be covered by your auto insurance policy. Check your specific policy to find out what is covered and the coverage limits.

• Homeowner policies provide very limited coverage for boats: In general, homeowner’s insurance policies do not usually extend to a boat since it is a separate vehicle that is mobile and can travel anywhere. Some homeowner policies may provide very limited coverage for smaller vessels such as small sailboats and boats with motors that are less than 25 horsepower.

• Boat owner policies can usually be put on hold for parts of the year: With most boat policies, you can put the policy on hold when the boat is not in use, such as during the winter months. Keep in mind, however, that if you have a loan on the boat, you will need to keep your coverage in force year-round.

Speak with a Maryland Independent Agent to Discuss Boat Insurance Options: There are numerous factors that determine what type of boat coverage you need, and the price of your policy. To find the best policy to fit your needs and budget, it is best to work with a local independent insurance broker. Independent agents work with several of the top insurance carriers in your state, and because they are not captive to any one particular insurer, they can shop around for you and provide an objective opinion on which company are offering you the best deal.