Do You Need Boat Rental Insurance?

Renting a boat is a much more economical alternative to purchasing your own vessel. Aside from the obvious savings on the purchase price, you also save yourself from the high costs of ownership, including boat insurance premiums. When you own your own boat, you must purchase a separate marine insurance policy to pay for physical damages and liability expenses. When you rent a boat, however, you do not have to take out an independent marine insurance policy. Although most boat rental companies fully insure their rentals on their own, you may still be liable for some expenses. Read on to find out more about how insurance coverage works on rental boats.

Liability Coverage

The company from whom you rent your boat has the responsibility to purchase liability insurance for the vessel. The liability component of marine insurance pays for physical injuries and damages you cause while operating the rental boat. Usually, the boat liability insurance also includes coverage for your medical expenses in the event that you are injured on the rental boat. If you cause injuries or damages to someone else while operating the rental boat, you may be responsible for a deductible before the rental company’s insurance will kick in. These deductibles can be very expensive, so make sure you understand what you are responsible for financially before you sign your rental agreement.

Physical Damage

The only reason you might purchase insurance for a boat rental is to cover physical damage that you cause to the boat. Boat rental companies typically hold the renter liable for physical damages or at least the deductible on their boat insurance. Some boat rental companies offer renters optional insurance coverage when they rent the boat. This temporary insurance policy would pay for any damage you do to the boat less a deductible. Without this supplemental policy, the company may hold you liable for all damages. In most cases, this optional insurance coverage is well-worth the slightly higher rental price.

Deposits

Before you can rent a boat, you typically have to put down a deposit that ranges from $500-$1,000 on average. Ask your boat rental company what this deposit is for, as some companies will use it to pay their boat insurance deductible in the event you damage the vessel. The rental company may only charge a deposit to give you an incentive to return the boat, however, in which case you would still be responsible for insurance deductibles in the event of a loss. Read your boat rental agreement carefully to find out how much you would have to pay if you damage your boat or someone else’s.