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Old 17-09-2008, 09:11   #1
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IKE: If you are "shopping", you might want to buy NOW?

The destruction in the Houston area (Clear Lake & Galveston) is much, much worse than they originally thought. Hundreds, if not thousands of boats have been heavily damaged or destroyed. This area is the 4th largest sailing center in the US, and a large percentage of them are lost.

This SHOULD translate soon to a "Seller's Market", rather than the strong "Buyer's Market" we have today. If that happens, the softening in the boat market might get a little harder.

For instance, Yachtworld shows 7231 sailboats for sale in the US, between 30 and 60 feet. A few hundred new buyers could certainly affect this supply...

Of course, I've been known to be TOTALLY wrong before!

And no, I'm not in "the business".

Oh yeah - and if you want a "fixer upper", you might just hang tight...
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Old 17-09-2008, 10:22   #2
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I asked this question on the other Ike thread which I realized after posting was inappropriate and insensitive to the plight of those boaters directly affected, who were trying to get news. My apologies!

But since this thread is more of a post storm analysis….I will ask again.

Thanks Chuck for the photos, disturbing as they are. I don’t know that area but it seems the sheer density of boats makes it very difficult if not hopeless, to protect from this level of surge and wind.

I can now understand the emphasis on carrying boat insurance, but again excuse my ignorance, would those boats that were damaged at their slips, when the slips were destroyed, have any kind of coverage, or is this considered an “Act of God” type exemption in the US?
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Old 17-09-2008, 10:43   #3
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would those boats that were damaged at their slips, when the slips were destroyed, have any kind of coverage, or is this considered an “Act of God” type exemption in the US?
Good question. This is where we have an opportunity to really find out the value of different insurance policies. However I suspect, cynic that I am, that many of the companies will stall and drag their feet and delay payment until there isn't as much attention being paid.
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Old 17-09-2008, 10:57   #4
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Quote:
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I asked this question on the other Ike thread which I realized after posting was inappropriate and insensitive to the plight of those boaters directly affected, who were trying to get news. My apologies!

But since this thread is more of a post storm analysis….I will ask again.

Thanks Chuck for the photos, disturbing as they are. I don’t know that area but it seems the sheer density of boats makes it very difficult if not hopeless, to protect from this level of surge and wind.

I can now understand the emphasis on carrying boat insurance, but again excuse my ignorance, would those boats that were damaged at their slips, when the slips were destroyed, have any kind of coverage, or is this considered an “Act of God” type exemption in the US?
Insurance coverage is a pretty exact science right now. Your policy will state exclusions and inclusions but you will need to read it. We have coverage for named storms and although it is very expensive, we tend to hang out in storm prone areas. If your policy excludes named storms you are simply out of luck. Many policy also exclude certain navigational areas during storm season and if you are in those areas you have either no coverage at all or no coverage for named storms depending on the wording of the policy.
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Old 17-09-2008, 11:01   #5
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Good question. This is where we have an opportunity to really find out the value of different insurance policies. However I suspect, cynic that I am, that many of the companies will stall and drag their feet and delay payment until there isn't as much attention being paid.

Those covered by homeowner or auto policies will probably see delays in payment. Those with insurance companies with less than stellar backgrounds may find no checks coming. But those of us that have chosen carefully and researched the companies we chose will generally find them to be prompt, professional, experienced in these types of claims and ready to settle the claims quickly.
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Old 17-09-2008, 11:05   #6
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I lost "Tango Too" in Isabel. Markel American paid promptly, including all expenses to have the boat lifted off the pilings, floated, towed to a marina and hauled. I was pleased and impressed. They were extremely helpful and sympathetic. That kind of service is definitely worth paying a little bit more for.
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Old 17-09-2008, 11:12   #7
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I hope so Chuck that the claims will be settled quickly but I wonder with the difficulties in huge insurance companies like AIG looking for bail-outs or bankruptcy,….. will there be a different attitude now and will confidence in insured buyer replacements for Ike destroyed boats, motivate buyers and insurance companies to take that risk again?

All of this will affect the boat market as the OP suggests
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Old 17-09-2008, 11:18   #8
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AIG does not sell vessel insurance that I know of. And of course ALL of our insurance rates will go up. We go through this every time a hurricane strikes a coastal area and lately that is frequent. Companies don't bail out or collapse. the year the most hurricanes hit the coastal US and the companies paid out the most in claims on boats, etc was a record profit year for the insurance industry. They keep money in reserve for these cases, in many states it is required, and they invest much of thier premium payments.
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Old 17-09-2008, 12:08   #9
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Our insurance covers for named storms - with caveats. You must properly prepare your boat, which includes removing all canvas and sails. Most policies have a larger deductible for named storms - typically 5-10%.

Yes, we will soon find out which companies perform the best!
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Old 17-09-2008, 12:42   #10
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TX boats

FYI: my boat took a direct hit from Ike in Kemah, TX. It survived undamaged. Still for sale....
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Old 18-09-2008, 16:57   #11
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Actually, AIG does sell boat insurance. They own a marine insurance division called NH insurance. We are watching the ratings on that company carefully.

Regarding Chuck's comment "Many policy also exclude certain navigational areas during storm season and if you are in those areas you have either no coverage at all or no coverage for named storms depending on the wording of the policy." I'd like to add to that, since I am often asked about it. With 90% of marine insurance policies, if your navigation lists a restriction (such as "the vessel must be north of Savannah GA between June 1 and Nov 15th") , and if you break that warranty, then you have voided your entire policy. If you later had a claim, completely unrelated to being in the hurricane box during hurricane season, for example, theft of the vessel, it would not be covered. The reason is that you had a deal with the insurance company, which you broke: you agreed to stay out of the hurricane zone during the hurricane season, and they charged you a rate based on that agreement.

Markel Jackline is one exception to the above- you do not warrant that you will keep the boat out of the hurricane zone. They just exclude tropical storm damage in the hurricane zone during the hurricane season (some exceptions to this are available for an additional fee). All other coverages (theft, lightning, collision, etc) remain in effect. The benefit of that is that if the weather is clear, you can choose to head into the hurricane zone a little early, which many cruisers heading to the Caribbean like to do.

Therefore if you need to be in the Hurricane Zone during Hurricane season, be sure to get a policy that covers such navigation. Policies from a reputable company that offer coverage in the hurricane zone without windstorm coverage will explicitly state that windstorm coverage is not included in the hurricane box.
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Old 18-09-2008, 17:00   #12
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Susan, we have the Markel policy and were told that if we are south of the required area the policy is void, period.
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Old 18-09-2008, 17:23   #13
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Actually, AIG does sell boat insurance. They own a marine insurance division called NH insurance. We are watching the ratings on that company carefully.

Regarding Chuck's comment "Many policy also exclude certain navigational areas during storm season and if you are in those areas you have either no coverage at all or no coverage for named storms depending on the wording of the policy." I'd like to add to that, since I am often asked about it. With 90% of marine insurance policies, if your navigation lists a restriction (such as "the vessel must be north of Savannah GA between June 1 and Nov 15th") , and if you break that warranty, then you have voided your entire policy. If you later had a claim, completely unrelated to being in the hurricane box during hurricane season, for example, theft of the vessel, it would not be covered. The reason is that you had a deal with the insurance company, which you broke: you agreed to stay out of the hurricane zone during the hurricane season, and they charged you a rate based on that agreement.

Markel Jackline is one exception to the above- you do not warrant that you will keep the boat out of the hurricane zone. They just exclude tropical storm damage in the hurricane zone during the hurricane season (some exceptions to this are available for an additional fee). All other coverages (theft, lightning, collision, etc) remain in effect. The benefit of that is that if the weather is clear, you can choose to head into the hurricane zone a little early, which many cruisers heading to the Caribbean like to do.

Therefore if you need to be in the Hurricane Zone during Hurricane season, be sure to get a policy that covers such navigation. Policies from a reputable company that offer coverage in the hurricane zone without windstorm coverage will explicitly state that windstorm coverage is not included in the hurricane box.
That sounds just like insurance.

Let's see, I go to FL tomorrow for a couple of weeks and then return above "the line", and then a year later have some sort of claim and am not covered because I crossed "the line" last year some time???

Did I get that right??

-------------------------------------

Say I have hurricane coverage and live in FL......and then there is wind and then there is hurricane. Is there also a tropical storm? What about a depression? A low? What if there is a storm in the gulf but a local thundersorm does me in. What is the company going to say? I think I know.

Sheesh!

Maybe I will not be able to cruise with insurance because of the cost and so will be like others........none.......or liability only.

If I do have it I hope I have a good, honest person to explain all that gobble-de-gook to me. I can read but have missed a couple of things in my day. One of those tiny words missed would surely put me over the edge if I was told, "Sorry, not covered, have a nice day." said in a nice sweet politically polite voice.

If that happened I would go to jail for a very long time. I guarantee it.
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Old 18-09-2008, 18:12   #14
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"we have the Markel policy and were told that if we are south of the required area the policy is void"

Chuck,
You were told correctly. However, please note that Markel has two separate Yacht polices:

1. Markel Helmsman (what you have) which offers coverage as far south as the Bahamas, Turks and Caicos. If you do not honor your navigation warranty, your policy is void.

2. Markel Jackline, the offshore cruising policy, which offers coverage almost anywhere in the world. This policy does not warrant that you stay out of the box during the hurricane season. If you decide to head south a little early, it does not void your policy. If you leave your stated navigation territory, coverage is restored when you return to your navigation territory with ramifications to the coverage.
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Old 18-09-2008, 18:22   #15
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"Let's see, I go to FL tomorrow for a couple of weeks and then return above "the line", and then a year later have some sort of claim and am not covered because I crossed "the line" last year some time???Did I get that right??"

Therapy, yes, you got it right. If you cheat on your side of the insurance contract, then you have voided your policy. When you purchase insurance, the application form you sign is a legally binding contract. Of course, the claims adjuster would have to find out, which is surprisingly easy, what with people posting things on forums and keeping boat blogs and the like....

Anyway, that's why I post on this forum and have given Q&A sessions in places that cruisers gather, in the hopes that some of the misunderstandings about insurance get clarified, and that anyone who files a valid claim gets paid.
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