Marine insurance is one of those things most boat owners hope they never have to use. But when something does go wrong, exactly what is — and isn’t — covered can suddenly become very important.
With boats becoming more valuable and technologically advanced, and the cost of repairs, labour and replacement parts increasing, understanding your insurance cover is arguably more important than ever.
MySailing asked specialist marine insurer Pantaenius to share some of the lessons its team has learnt from insuring boats and handling claims in Australia and around the world.
More than just the premium
One of the most common mistakes boat owners make when choosing insurance is focusing primarily on the price.
According to Pantaenius, a lower premium may come with higher excesses, narrower cover or greater depreciation.
“The real value of insurance becomes apparent when a claim occurs, not when the premium is paid,” the Pantaenius team says.
Before taking out a policy, owners should understand whether their boat is insured for an agreed value or market value, how depreciation is applied and what excesses apply.
Other questions worth asking include whether machinery, sails, rigging and personal effects are covered, what navigational limitations apply and who will actually manage the claim if something goes wrong.
For those who race their boats, there is another obvious question: is racing covered and, if so, are there additional limitations or excesses?
Why marine insurance is different
A boat isn’t simply a car that happens to float.
Its location, construction, value, equipment, cruising area, exposure to weather, the owner’s yachting experience and the way the boat is used can all affect its insurance.
Marine claims can also require specialist repairers, surveyors, salvors and claims handlers, adding further layers of complexity.
Founded in Hamburg in 1899, Pantaenius has more than 125 years of experience protecting boat owners, with over six decades dedicated exclusively to specialist yacht insurance. Pantaenius Australia was established in Sydney in 2012 and now supports boat owners throughout Australasia and beyond.
During that time, the Australian boating market itself has continued to evolve.
Pantaenius says boats have generally become more valuable and technologically advanced, while repair, labour and replacement-part costs have increased.
The company is also seeing more international boats entering Australian waters, particularly in Queensland where major refits can take place.
At the same time, more Australian customers are looking further afield, with Pantaenius seeing an increase in South Pacific cruising as well as owners buying vessels overseas and taking an extended period to cruise them back to Australia.
Comprehensive doesn’t necessarily mean everything
Another misconception is that having comprehensive insurance means everything that happens to a boat will automatically be covered.
That’s not necessarily the case.
Insurance is designed to protect against unforeseen and accidental events rather than problems that develop gradually through wear, deterioration or neglected maintenance.
Pantaenius says owners can sometimes be surprised to discover that damage resulting from a lack of maintenance or failure to carry out necessary repairs isn’t covered.
“Ultimately, good insurance and good boat care go hand in hand,” the team says.
Understanding exclusions and an owner’s responsibilities is therefore just as important as knowing what is covered.
What happens when something goes wrong?
This is where insurance moves from a document to something very real.
Pantaenius has dealt with everything from boats damaged by cyclones and fires to remote groundings, dismastings during ocean passages and complex salvage operations.
Some of the most memorable cases have involved situations where quick decisions and access to the right people prevented an already difficult situation becoming considerably worse.
The Pantaenius team says one lesson stands out from handling claims over the years: communicate early.
“Good communication changes everything.”
Owners are encouraged to contact their insurer as soon as possible, even if they’re uncertain whether an incident will ultimately become a claim.
Early involvement can help protect the boat, preserve evidence, control costs and potentially prevent further damage.
Know your policy before you need it
Perhaps the simplest advice from the Pantaenius team is also the most important.
Don’t wait for something to go wrong before finding out what your policy actually says.
Know the insured value of the boat. Understand the geographical limits, excesses and exclusions. Know your responsibilities as the owner and make sure the policy reflects how and where you actually use the boat.
And if something isn’t clear, ask.
Pantaenius says it would like more customers to feel comfortable contacting the team for advice whenever they’re unsure about their policy or how a particular use of their boat might affect their cover.
That’s a conversation much better had at the dock than after something has gone wrong.
Look out for more articles in our marine insurance series with Pantaenius over the coming weeks, covering boat maintenance, yacht racing, overseas cruising and preparing your boat for severe weather.
Find out more about Pantaenius and its specialist marine insurance for Australian boat owners at pantaenius.com
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