For those of us who are not in the insurance business, insurance can be very hard to understand.
Often, when our insurance agents start talking about liability, comprehensive coverage, third-party liability, and other things, we feel like they are speaking a language we have never heard before. Well, they kind of are.
Again, people who aren't in the insurance business find it very hard to understand. Unfortunately, you need to learn some of the terms if you want to get the coverage you need at a price you can afford.
For example, many people don't know what the difference is between full coverage insurance and third party liability insurance. Full coverage insurance and third-party liability coverage are similar in many ways, but they are also very different in some ways. Before you can decide which one you need, you need to know what each type of coverage is.
Third Party Liability Coverage is basically protection in case you cause an accident and hurt someone else.
It usually pays for damage to other people and their property caused by an accident that is covered. It doesn't cover you, your passengers, your boat, your motor, or your trailer. Also, third-party liability coverage only applies if your boat was being used privately and not for business.
Most states require you to have third-party liability insurance, and each state has its own minimum liability insurance requirements.
This kind of insurance is usually required whether or not you have a loan for your boat. Most of the time, people just call third-party liability insurance liability insurance, or in the case of boats, watercraft liability insurance. Talk to your insurance agent to find out how much coverage your state requires.
On the other hand, full coverage insurance covers you, your boat, your motor, your trailer, and your passengers.
It is often called "comprehensive insurance," and it comes in different coverage amounts and with different options for the policy. Most lenders who loan money for boats will require this type of insurance, and most lenders will have their own rules about which optional insurance must be bought.
Third party liability insurance protects other people and their property if you cause an accident. Full coverage insurance protects you and your property in the same way that third party insurance protects other people.
In fact, if you have full coverage insurance, you will be covered even if the accident was not your fault. Most of the time, it's best to have both third-party liability insurance, which is required, and full coverage insurance, which may be needed if you financed your boat.
Again, you should strongly think about getting a full coverage or comprehensive policy, even if the boat is not financed. Many people keep the full coverage policy even after they've paid off the boat.
It costs a lot to fix a boat, and anything can go wrong.
Most full coverage policies will cover you if your car breaks down, is stolen, or damaged by someone else. They will also cover losses caused by storms, fires, explosions, sinking, and a lot more. Talk to your insurance agent to learn about the different full coverage policy options, and make sure you get the coverage you need!
