Boat Insurance regarding outdrive problem

[AL]

Last Saturday while underway between Kelly Island and South Bass I was traveling about 23 MPH when the boat just stopped. The motor continued to rev but the gears shift was dead, limp, nothing when moving the stick from forward to reverse.

Towed to the marina, boat lifted from water and the mechanic inspected the boat on Monday with these findings.

"Fish line wrapped around prop shaft letting oil leak from drive and causing damage to upper gearset, vertical shaft and prop shaft."

I have complete trust in the mechanic who recommended new replacement parts.

My question. The insurance adjuster advised the claim sounded pretty cut and dry however he would need to review the estimate for parts and pricing. He then advised that since the boat is a 1989 the replacement parts they woould pay for would be RE-MANUFACTURED parts.

Have any of you experienced this and how did you handle it.

Thanks for your feedback.

Al

[mr ducks]

Your lucky they will pay for remanufactured parts--most policies would depreciate the parts and this could cost you a lot of money. I'm assuming you did not buy replacement cost coverage--doubt that many carriers would offer RC on an older boat!

[Johnboy]

I don't see anything lucky about buying insurance and when you need to use it you are told we'll give you old used parts. A few years ago lightning struck my home and when I called the insurance company (the one that I paid home owners premiums to for twenty years) that
I didn't have the right kind of insurance and that they would only pay pennies on the dollar for my loss.

When I bought the insurance I was told it was exactly what I needed and every few years when the insuranc agent told me to increase coverage I like an A..H... paid him. I'm sure his commission checks were paid in full and not in fractions.

Obviously insurance is a hot spot for me. I'll trust Enron and World.com executives before I ever trust an insurance agent again.

Wheeew, I got to take a breath.

My two cents.

John B.

[Scubby]

Pay the difference if you have to and buy new parts. Why use someone else's problem.

my 2 cents.

Scubby

[mossboss]

You are lucky that the claim is being covered at all. Fishing line in the prop seems like a claim that most companies would deny.

[Ranschau1]

I am an insurance adjuster.

The way this is reasoned is really quite simple. Unless you purchased Replacement Cost coverage (RC), you have Actual Cash Value coverage (ACV).

If you have RC you get new parts without and deductions for age, wear, etc.

If you have ACV you get "like kind and quality" parts. This may mean used if available or remanufactured if used is not. I usually explain this with the rationale that since the parts that were damaged were not new, we don't owe for new parts, we owe for parts that are in the same, or close to the same condition as the parts that were damaged.

Of course this all depends on the availability of the parts.

Not being terribly familiar with boat policies--My experience is with auto claim---I would question if this is even covered. Certainly not a collision with anything.

Live Long and Prosper

Good luck.

Mike

[Al]

Insurance adjuster agreed with claim. Will repair with new parts and will pay the claim less the deductible. Needless to say thats a load of my mind.

Thanks to all.

Al

[Aquaholic]

Ranschau1........and you other insurance buzzards, the only insurance guy I ever trusted once told me the purpose of insurance was to help protect me from finacial loss.How is running over fishing line not an accident..?Your attitude is what gives insurance folks a bad rap.

[rickn]

Ranschau1,It must be a misprint, the screen shows you as a registered user! Can it be?lol

[muddog]

My question is- as the boat ages the used parts age and are worth less so the insurance pays less ,that being , WHY doesnt you premium come down accordingly every year? Every year you should pay less for your insurance!

[Fish'n101]

Most policy contracts allow the Insurance Company to repair or replace. Parts can be used or new depending on availability. Most policies like car policies allow for used parts. Used parts are not always available and new or after market can be used. If the parts are mechanical have your mechanic inspect them carefully. You can probably pay the difference & have new put in.

Call your agent and ask if there was an optional coverage you could have purchased to avoid this. In most cases there are no options. Most boat pricing is based on a used value not new.

Whenever you are dealing with an insurance claim I suggest you keep a phone log of the conversations. Dates -- times -- who you spoke with & a summary of the conversation.

If you still aren't sure you are getting a fair settlement try contacting your state insurance commissioners office or state department of insurance.

Hopefully this will help....
Take care & good luck.

[Fishn101]

Earlier in the string some asked why your premiums don't go down on a (ACV) Actual Cash Value Policy. The company can use used parts because the boat is used etc.

Most companies won’t automatically devalue your boat. Some people use there boats a ton some hardly at all. Some brands of boats depreciate faster than others. It would be hard for a company to make blanket reductions in your coverage without your knowledge. Most policies and companies will allow you to reduce the amounts of insurance you carry to more accurately reflect the current ACV value of your boat, motors, trailer and accessories. This in turn will reduce the cost of your insurance. Besure you also add any new equipment that may not have been on the boat when you first insured. Items like GPS, fishfinder, radios, downriggers, trolling motors-electric or gas.

I am an insurance agent. Every year I send out writtenrecaps of my clients boat policy coverage & limits. In it I suggest they review the amount of insurance they have placed on their used boat. It could be and probably is over-valued in many cases. However it is very, very rare that customers read the information I send them. After 21 years I can honestly say most people are their own worst enemies in these policy coverage questions.
I send out hundreds of invitations to call me for an in person review of their coverage.

I also in large print say, " The best time to ask questions is before a loss."
However less than 1% of my customers will take 10 minutes a year to review their policy and options available to them. 99% of the claims problems are because the client has never read the policy language or frequently reviewed their coverage with a local agent.
Insurance is expensive and should be reviewed and maintained like a boat & motor. Don't assume anything. I love it when I am asked tons of questions by a client. That's good for them & me. They are never the client that is angry after a claim. They know they got what they paid for. In most cases that’s all any of us are asking. To be treated fairly.

Hope this can help prevent any future challenges with insurance.
Good Luck

[work2fish]

fishn101,

I am one of those guilty of not regularly reading my policies, especially when the insurance company makes a change and sends an update. The problem for me is that these are written in insurance language and are not always easy to understand. Thanks for clarifing some of the symbols like ACV, etc...

Regards,
work2fish

[Fish'n101]

Howdee to All! Insurance can be challenging to understand. Like a good fishing techniques it will take a little patience & practice.

First I would just like to say I enjoy everyone's posts. Discussions like on this board are great for everybody.

About Insurance. I am a local insurance agent for a little over twenty years. Policy scope of coverage and rates will vary like fishing techniques.
Here is some general informatation and questions I come across on a regular bases. Feel free to ask me a more specific question, but remember policies will vary from company to company & state to state. One company might be outstanding on big boats and yachts but not so good on smaller boats, say 30,000 and under.

So take what I have to say with a grain of salt. Most companies will categorize the risk (Your boat & how you use it) by type of boat, type of use and speed/horsepower, to name a few.

Other pricing factors include; do you have any other insurance with the company (Like Auto or Home Insurance), how old are you, have you taken any safety courses, have you had any claims, do you have any tickets or accidents in a boat or automobile. Some companies offer discounts for taking coast guard classes.

Using these variables companies will frequently come up with a cost per thousand value for the hull, trailer and motor(s) if you have outboards.
Example $20.00 per thousand. Current market values > Boat 10,000 value = $200.00 Trailer $1,000 = $20.00. Outboard motor $5,000.00 = $100.00. Total value Boat, motor, and trailer, $16,000 = $320.00 per year plus any optional add-ons. Most policy are 12 months.

Other option coverage will be liability limits, medical limits, accessories, towing and of course the good old deductible options. A deductible is usually the first part of a loss that you will be responsible for. In most cases higher deductibles are better in the long run.

In case your boat is a total loss will the policy pay based on a used value (like a car policy) or will it pay to replace your used boat with a new one? This can be big. Most pay on a used value like an auto policy. The policies that pay replacement value are normally more expensive especially for older boats. You will have decide if it is right for you and your boat.

Usually there are limitations and exclusions of coverage. Such as the waters you use you boat in, boat accessories are usually limited (But can be increased), and items like fishing poles, tackle, etc are frequently excluded. Towing unless part of a covered loss is frequently not covered.

A good approach to comparing policies is to get quotes & ask for an explanation in writing of what the policy will & will not cover. For some people towing can be a huge item for me I fish only small water, not a big deal.

Every boat on the water regardless of value should think hard about liability insurance. Everybody wants to sue.

Don't be afraid to take your actual policy to your local agent and ask them to show you how to read it. Policies and their scope of coverage will vary from company to company and state to state. But, the basics are usually very similar.

Think of some possible loss questions or examples to ask. I'll give you a few to get everyone thinking. Maybe someone else reading this can throw some good examples in.

1. If I am driving my boat and hit a rock under the water damaging my boat and motor, am I covered?
2. If someone driving another boat hits me and damages my boat am I covered? Will it matter if the other person is or is not insured.
3. If I run out of fuel or can't get started up -- does my policy cover marine assistance or towing? If yes are there limitations?
4. If I get tangled in a commercial fishing net damaging my boat & the commercial fishing net, how am I covered?
5. If someone steals my kicker motor off my boat am I covered, If yes is it going to be a used value or replacement?
6. If someone steals my expensive rods - reels and tackle of my boat am I covered. If yes will it be depreciated or replacement. Will my homeowner's policy cover this loss if my boat policy does not?
7. If my inboard boat motor freezes and damages the motor this winter am I covered?
8. Am I covered to operate my boat in any waters anywhere or are there territorial limitations to my policy?
9. Can anyone drive my boat with my permission and be covered.
10.Can I drive someone boat and have coverage extended to that borrowed or rented boat?
11.If I buy a new boat and trade my old boat in do I have temporary coverage? If yes what are the limitations of that coverage and what time frame do have to work within?
12. If I hit a swimmer in the water with my boat and hurt them, am I covered and what are my limits of coverage? Are there options for increased limits?
13. What is my deductible and what type of losses will it apply to.
14. Are boat accessories covered? Items like oars, anchors, radios, flare guns, navigational equipment. Will it be replaced at a full or depreciated or used value? Ask them to define what are and what are not accessories.
15. If I turn in a loss what is your company going to do? Will they raise my rates or change my coverage? What are the chances that I might get canceled if I turn in a loss? What if I have two losses?

Sorry this was long, but I feel it is important for people to know what there buying. In most cases they are buying a legal contract binging you and an insurance company into an agreement.
Hope I have helped in some way. No easy answer. You have to do your homework to get the right coverage for you at a fair price. If all things were equal I would try & keep your coverage with your home or auto insurance agent.

[muddog]

FISHN101 , Please take no offense ,I thank you for posting. But my co. never asked if i took a safe boating course or not. when all those things are hidden that is deception! They are VERY quick to take your Money,so nothing should be hidden. The customer doesnt know what they have to offer it should be up to the Company to make sure you get what you pay for. In plain English!
MUDDOG

[Fish'n101]

Absolutely no offense taken, Muddog .

I appreciate the chance to chat with people. Insurance is just another tool to help boating more fun while protecting our investment. That's what these boards are about. Weather you are Merc guy or a Yamaha guy. Open discussion is great for everyone.
I agree with your statement completely both sides can greatly be improved. That's one of the reasons I typed the info I did. Hopefully it will help all those who read it.

Again most small local agents like myself do a pretty good job. The thing a small agent can offer is knowledge and experience. Most agents want to keep their customers for a long period of time. We make very little money per policy up front. The key to an agency like mine is long term relationships with my customers. The average customer in my agency has been with me 10 to 15 years minimum. Which means during times of claims etc. Nobody wants to be involved in a claim. It is a pain. But a good local agent can minimize the stress. I believe that explaining the options and coverage before a loss is the best way to keep a customer after a loss. Nobody is going to remeber everything when they first write up the policy that's why I send out 100's of invitations a year for insured’s to call for a review. In most cases the changes usually lower the premiums. Again the insured should be involved and activley be asking questions.
Many people buy insurance policies from a company rather than a local agent or just get on the phone & pick the lowest price. Kind of like assuming that you call around and find the cheapest 90 hsp motor without knowing what brand, is it a 2 or 4 cycle etc. A lot of people just shop for the cheapest. They are usually the ones that yell the loudest when there is a claim.
Not to unlike a novice boater buying a boat & motor over the phone without seeing the inventory in person or setting down with a salesman in person. I like having my boat dealer handy. I like to stop in and see what’s new. I think you would benefit from having a local agent who would like to have you come in and see what’s new or just swap fish stories.

I hope the info I offer is helpful in creating the desire in others to find out what they bought. Most people will find they bought a good policy and with a little adjusting it will fit their needs & budget.
Please ask if you have any other questions or concerns.

[Airwave(OH)]

Al I work as a Marine Mech. in Marblehead. Just curious where you went. Alot of times the insurance companies try to get us to use Re-man parts. We do if we feel it to be OK. We have a place we get our stuff that we have had real good luck with and feel confident in there work. That may make you feel alittle better.

[Ranschau1]

Alcoholic-

Read my post again. I simply offered my experience and knowledge to Al's situation, and I had the guts to register so you or anyone else can actually e-mail me if you like.

I fully admit to not having much experience with a boat policy. Since Al says the claim is covered, that is no longer an issue.

My post was friendly and (hopefully) informative. Yours was condesending and rude.

Get a life.

As for the cost of the insurance not going down, check the individual coverages your paying for. Most likely the coverage for damage to the boat is going down, or at least treading water, but the cost for liability, medical expense, etc are going up. Everyone loves to sue when injured and that is simply driving the cost up. Additionally, the marina's are not getting less $ per hour to work on the boat and many times re-man, aftermarket, or used parts today cost as much or more than new ones did 5 years ago.

Again, my experince is with auto claims, but I belive the same principles aply.

Mike

[muddog]

FISHN101
I agree the agent can be your friend in answering questions and explaining things. But many Companys offer insurance by just calling them ( mine is thru Mercury)which are cheaper, and dont we all want to pay as little as we have to? BUT we lose the ability to call our local agent with a question any time we want. You are right both sides could use work! Sometimes cheeper isnt better.

[Fish'n101]

Howdee Muddog.

Give this a try! Look up the phone number of your insurance company and ask them the questions & various info I have mentioned above. I'll bet someone can help you. You can also call the claims department and ask as adjsuter questions. Again I always suggest you get peoples names, title etc. Note the date time & phone number you called. Ask the person if they have a direct line should you have questions in the future.

PS In case you don't -- be sure to put the claim phone number & policy # for your boat in your boat & in your tow vehicle.

Call your auto or home agent or both. Ask them to give you a quote... You might be suprised.

Less expensive isn't bad -- you just might have to be a little more active and deligent to find out just what you did buy.

Remember your auto/home insurance company has a lot more reason to keep you happy than a company with only your boat insurance.

Good Luck....

[bump it up pleeze]

curious