Boaters often want to know whether they have to carry boat insurance to enjoy the water. The answer is that boat insurance can be required for a variety of reasons. For example, some states require that you have liability coverage. Marinas may require you to have boat insurance in order to dock your boat there.
Boat insurance covers damage to your boat, motor, trailer, and personal items in the boat. It protects the boat owner against liability lawsuits and medical payments. Boat insurance protects most watercrafts with engines, including small fishing boats, powerboats, houseboats, yachts, and pontoons.
Some boat owners may assume that their boat is covered under their homeowner's insurance policy. But in fact, there is only limited coverage ($1000-$1500 depending on the insurance company) for damage to a boat on your homeowner's policy. And, generally, the loss must occur at your home.
When you buy boat insurance, you must decide on the amount of coverage you need for your boat, the deductible (maximum out of pocket expense per claim) and the types of coverage you need. In the event that you have an accident, experience a theft, or have another loss that is covered under your policy, you can file a claim and receive a payment covering the loss.
As an example, if you were in an accident with another boat that caused serious damage to your vessel, one of the following things would most likely occur, depending upon the insurance coverage you and the other boater own and the laws in your state: