Insurance challenges - Canada

[Mike OReilly]

Originally Posted by hpeer

My perception is that the liability can vary greatly. In Newfoundland the liability risk is small. Not a lot of “high value targets.”

Down in the Caribbean it is an entirely different matter. There we are surrounded by high end boats. And with the anchoring conditions, frequently steeply sloping, it is all too easy to drag off. And their lawyer is likely a lot bigger than my lawyer.

I was surprised how much our liability only coverage cost. Yet, in my particular circumstance, I feel it is well worth it.

Our steel hull is worth a lot to us. But maybe only $100k reasonably insurable. The neighborhoods tinsel cat may well he worth $1M. That is the greater loss I seek to mitigate.

I'm sure you're correct about location.

How much are you paying Howard? Looking at my policies, my one from 2019 with Aviva has me paying $84 (CND) for $2million in insurance. This is more or less what I've been paying for the previous decade, all through Skipper's Plan. My second most recent policy doesn't even itemize the liability cost. They just say "included." This was specifically when I was in Atlantic Canada. Hopefully I'll be able to report what it is costing me for my current insurance once I see the full policy (I just negotiated it).

My bet is that along with the factors you cite, liability is also highly dependent on the litigiousness of the market. The USA is, bar none, the most litigious society. Does this effect roll over to the Bahamas and the Caribbean?


ADD: Funny... as I was typing this I got my current policy. My $2M in liability coverage is costing me $13 (CND).

[Jammer]

Originally Posted by Lake-Effect

Questions (any insurance brokers here to answer?): do not some home policies offer some basic boat liability coverage? Also - if the home policy also offers personal liability coverage, could that not be applied to the boat?

My homeowner's policy offers liability coverage for boats within size and horsepower limits. Doesn't matter much though because it's not good enough for the marina and I'm certainly not going to list them as an additional insured for my house.


fwiw like most, my homeowner's policy provides hull insurance up to certain limits also but only while the boat is stored inside a building with four walls and a roof.

[Mike OReilly]

Originally Posted by Mike OReilly

I'm sure you're correct about location.

How much are you paying Howard? Looking at my policies, my one from 2019 with Aviva has me paying $84 (CND) for $2million in insurance. This is more or less what I've been paying for the previous decade, all through Skipper's Plan. My second most recent policy doesn't even itemize the liability cost. They just say "included." This was specifically when I was in Atlantic Canada. Hopefully I'll be able to report what it is costing me for my current insurance once I see the full policy (I just negotiated it).

My bet is that along with the factors you cite, liability is also highly dependent on the litigiousness of the market. The USA is, bar none, the most litigious society. Does this effect roll over to the Bahamas and the Caribbean?

ADD: Funny... as I was typing this I got my current policy. My $2M in liability coverage is costing me $13 (CND).

I just read another Canadian marine policy which lists $2M in liability as costing $100 (CND).

[hpeer]

Mike,

I will have to check with the Finance Minister on actual cost but IIRC it is around $500/year.

That is on our big boat. No clue how they calculate.

Expensive other boats, protected coral reefs? I am guessing size matters.

“Guessing” being the operative word there.

[alctel]

Originally Posted by Lake-Effect

That's not far off of what we pay for liability plus a little hull & contents insurance for a smaller boat. But what are your marina charges for the Shark?
I sort of lump our slip plus insurance together and treat it as just the annual cost of sailing a boat. We're at a club, which helps keep costs down and is fun to boot. Plus the lovely reciprocals privileges.

Questions (any insurance brokers here to answer?): do not some home policies offer some basic boat liability coverage? Also - if the home policy also offers personal liability coverage, could that not be applied to the boat?

Paying $450 a month for a slip. I'd have kept it on a buoy but I bought it with a friend and she wants it in a marina as it's easier to jump on for a quick sail, and we don't have to muck around with a dinghy. I do see her point, and splitting the bill in two does help but still, ouch.

I am going to join the local club here at some point but they have an 8 boat waiting list for a slip...

I checked out some of the other places mentioned in this thread but they are Ontario/Quebec only most of them.

edit: when people complain how sailing is dying out and young people aren't getting cheap boats like they used to 'back in the day', I think things like this are a major reason. If I already didn't have some experience/contacts from owning a bigger boat for 7 years in the area I wouldn't have been able to find a slip/mooring buoy or find insurance. Someone new to sailing would find it even more frustrating/intimidating.

[pcmm]

Originally Posted by Lake-Effect

That's not far off of what we pay for liability plus a little hull & contents insurance for a smaller boat. But what are your marina charges for the Shark?
I sort of lump our slip plus insurance together and treat it as just the annual cost of sailing a boat. We're at a club, which helps keep costs down and is fun to boot. Plus the lovely reciprocals privileges.

Questions (any insurance brokers here to answer?): do not some home policies offer some basic boat liability coverage? Also - if the home policy also offers personal liability coverage, could that not be applied to the boat?

Yes home insurance does often offer coverage for boats but when I inquired mine would only cover boats under 20ft and less than 20yrs old. No use to me!

[Mirage35]

Following up on Mike's recent comments, my $2M liability is $93 per year. It may depend on location - when I first insured they were very inquisitive about where I keep the boat summer and winter.

[Lake-Effect]

Originally Posted by alctel

edit: when people complain how sailing is dying out and young people aren't getting cheap boats like they used to 'back in the day', I think things like this are a major reason. If I already didn't have some experience/contacts from owning a bigger boat for 7 years in the area I wouldn't have been able to find a slip/mooring buoy or find insurance. Someone new to sailing would find it even more frustrating/intimidating.

If someone's insurance is less than one month of slip... then I don't think it's the cost of insurance keeping people away from the sport.

[deblen]

Originally Posted by Mike OReilly

Just wanted to share my recent insurance challenges. I'm curious if others are seeing the same here in Canada. I know it's a common story in the US and other places, but it seems to have come home now...

The short story is I saw a big jump in my rates two years ago. And then this year had to really work to even get insurance. The issue seems to be the age of my boat: 44 this year.


Details.... two years ago my insurance through Intact (underwriter), which was brokered through Fairway Insurance of Atlantic Canada, jumped something like 30% in one year. No change from my end, and no claims -- ever.

I was told it was a system-wide increase, and I could do nothing about it. Not happy, but I paid the extra.

Then this year Fairway informed us that because they were switching underwriters from Intact to Aviva that they could no longer find any insurance for our boat. Apparently Aviva would not take the policy due to our boat age (over 40 years old). Fairway just dropped us like a hot potato, seemingly without trying to find another underwriter. I was not impressed.

I contacted another broker who was still working with Intact, and they immediately thought it would be no problem to renew the policy. But then Intact came back and said, since this was now a new policy (because of the new broker), they would no longer underwrite it. Again, the issue was the boat was over 40 years old.

Happily our new broker, AA Munro, (also based in Atlantic Canada) actually did what brokers are supposed to do. They went to work and found us an underwriter that would take the policy. But they had to go to a specialty underwriter: Cambrian Specialty Risks.

I'm happy to report we have a new comprehensive policy, with all the standard stuff, along with $2M in liability. And we actually saw a price reduction of about 30%.

Mike
My Fairway/Intact boat policy was to renew Jun 1. I got a letter from Fairway May 3 informing me that Intact were "done" with Yacht insurance.
I was also informed that a survey was required before they could find a new underwriter. I have had to get a survey every 5 yrs since I bought this boat in 2006,so I immediately called surveyor-as time was short.Luckily,the surveyor was coming this way the following week & $700 later,I have a new survey(no defects). (5 yrs ago same surveyor $ 500-Oh Well)
I have sent the survey & Ins application off to Digby/Liverpool.
No word yet,but I have not worried since I have dealt with Fairway since 1980 as a Marine Equipment supplier & as a customer & found them great.
Then I read your post. Wow! I guess I better get onto them tomorrow.
Sorry to have been one to recommend Fairway to you in the past.
Tks for AA Munro link. I may need them.
My annual policy cost has been C$400(2006) to C$600(2020) for $40K replacement & $2M liability. My restrictions were -In water Apr1-Nov30 Out of water with no heat aboard-Dec1-Mar31. N40deg(NYC) to N55deg).
Boat is 1984.
Cheers/Len

[pcmm]

Originally Posted by AnglaisInHull

Following up on Mike's recent comments, my $2M liability is $93 per year. It may depend on location - when I first insured they were very inquisitive about where I keep the boat summer and winter.

WOW!! $2m liability for my 41ft sailboat is costing me $485 per year here on Lake Ontario I don't think I've ever paid that little even for my little 22ft sailboat! That's quite the deal!!

[deblen]

Originally Posted by LittleWing77

These points are all crucial, to my mind.

Not only the condition of any particular boat (40+ year "good old boat" or a badly constructed brand-new Lagoon catamaran), but also the increasing frequency of named storms due to global warming. The insurance industry seems to be waking up to all of this.

As I watch all the relatively inexperienced people flock to buying sailboats (mostly catamarans) because of watching YouTube videos, we can track a parallel increase in:

(1) high-damage/cost catamaran claims after hurricanes Catamarans are disproportionately expensive boats and now the more frequently purchased, so their repairs/ write-offs have surely been commanding a disproportionate amount of insurance companies' outgoing funds and will only continue to do so (of course, this is pertinent to Bahamas and/or Caribbean cruisers, but lots of us go South for the Winter or are intending to do so);

(2) badly maintained 40+ year-old boats (no disrespect to Mike, of course, I'm just speaking generally) A newbie who buys an inexpensive sailable old boat doesn't know what they don't know and/or if she sails, they may not care; regular maintenance is not upkept and the boat becomes a sailing timebomb...

So here's what I'm thinking:

> A five-year survey cycle is slightly onerous, but reasonable qualification hurdle for continued coverage. In effect, it creates a "status of boat" record for the Insurer, as well eliminating badly maintained boats from the insurance pool. Additionally, regular good surveys/surveyors help provide a priorities list for the Owner of things needing immediate attention, especially for those who are new to boat ownership.

> An Owner's qualifications and circumstances may become increasingly important and prerequisite to obtaining insurance. Over the past year on this Forum alone, I've seen countless insurance pleas from absolutely green non-sailors and single-handers with little experience who are having a hard time finding an Insurer. This is the canary in the coal mine...

Just some observations,
LittleWing77

Good logic. Weed out the more risky owners & a 5yr survey helps weed out the more risky vessels. Costs go down. Capitalism at it's best. / Len

[Mike OReilly]

Originally Posted by deblen

Mike
My Fairway/Intact boat policy was to renew Jun 1. I got a letter from Fairway May 3 informing me that Intact were "done" with Yacht insurance.
I was also informed that a survey was required before they could find a new underwriter. I have had to get a survey every 5 yrs since I bought this boat in 2006,so I immediately called surveyor-as time was short.Luckily,the surveyor was coming this way the following week & $700 later,I have a new survey(no defects). (5 yrs ago same surveyor $ 500-Oh Well)
I have sent the survey & Ins application off to Digby/Liverpool.
No word yet,but I have not worried since I have dealt with Fairway since 1980 as a Marine Equipment supplier & as a customer & found them great.
Then I read your post. Wow! I guess I better get onto them tomorrow.
Sorry to have been one to recommend Fairway to you in the past.
Tks for AA Munro link. I may need them.
My annual policy cost has been C$400(2006) to C$600(2020) for $40K replacement & $2M liability. My restrictions were -In water Apr1-Nov30 Out of water with no heat aboard-Dec1-Mar31. N40deg(NYC) to N55deg).
Boat is 1984.
Cheers/Len

No worries Len. You weren't the only one to recommend Fairway. And to be fair, they treated us pretty good in the year we switched over. We did have to do a survey, but they accepted it without question, and provided a policy that was cheaper than our previous Skipper's Plan coverage.

Unfortunately, the following year we got that big increase, and when I tried to get any explanation, it was like pulling teeth. Then the third year we got summarily dropped. So unfortunately I'm not impressed with Fairway. But hopefully this was because of the age of our boat. At least Fairway had the decency to call us, and didn't just send out a letter.

Do keep AA Munro in mind. So far, they've been awesome for us. Of course, I felt the same way about Fairway at this point in the relationship, but they really did go above and beyond to find us an underwriter, and did it for very little cost, which means they barely made more than beer money.

BTW, not sure if I specified this, but we are now paying $440 for comprehensive insurance based on a $45,000 agreed value. This includes coverage for our dinghy and outboard, plus $2M liability (plus a bunch of other extras that I really don't care about).

[Mike OReilly]

Originally Posted by pcmm

WOW!! $2m liability for my 41ft sailboat is costing me $485 per year here on Lake Ontario I don't think I've ever paid that little even for my little 22ft sailboat! That's quite the deal!!

Is that for liability only, or is that full comprehensive that includes liability? If the former, I would seriously shop around. You can probably get comprehensive coverage (hull & liability) for roughly the same price, depending on the value of your boat of course.

As you can see here, most Canadian liability prices are coming in under $100 for $2M. My boat is 37-foot. This year I am paying $440 for full coverage (hull & liability). Last year I paid something like $600. The previous year it was around $400, which is where it had been for many years prior. That was when I was on the Great Lakes.

[pcmm]

Originally Posted by Mike OReilly

Is that for liability only, or is that full comprehensive that includes liability? If the former, I would seriously shop around. You can probably get comprehensive coverage (hull & liability) for roughly the same price, depending on the value of your boat of course.

As you can see here, most Canadian liability prices are coming in under $100 for $2M. My boat is 37-foot. This year I am paying $440 for full coverage (hull & liability). Last year I paid something like $600. The previous year it was around $400, which is where it had been for many years prior. That was when I was on the Great Lakes.

Yep that's liability only (Lake Ontario in the GTA) and was the lowest quote when I was shopping around. Even when I was in the U.S. liability only (for $330k coverage was $150USD

[Mike OReilly]

Originally Posted by pcmm

Yep that's liability only (Lake Ontario in the GTA) and was the lowest quote when I was shopping around. Even when I was in the U.S. liability only (for $330k coverage was $150USD

That is a fairly pricey boat, but still... Do you think it's a case of simply not having much choice when it comes to liability-only policies here in Canada? I know it's very difficult to find a broker that would even take this on. And I understand why ... there's just not enough in it for them.