When to Start Insurance on New Boat?

[deluxe68]

My wife and I just took the plunge and bought a brand new 2010 Beneteau 36.7. The boat is going to be delivered to San Francisco August 7-10 where it will live for at least a year. The salesman at the Beneteau stealership is not a lot of help, I still do not have the hull number yet. He does not know who is doing the commissioning and bottom painting. He just told me I need to have the policy start the moment the boat leaves the factory. This makes no sense to me, it seems to me that the trucking company would have to be liable while they have the boat. Or the dealer/broker would own the boat while in transit. What is the normal process: start the policy leaving the factory, when the boat arrives at the dealer, after the boat is commisioned, or after the sea trial?

[drew.ward]

Dude get it right away!

That's coming from someone who was shopping around insurance companies and a month into the process my last boat sank in a hurricane.

[Pelagic]

Originally Posted by deluxe68

... The salesman at the Beneteau stealership is not a lot of help,...

probably only a typo but quite fitting... Some of them are just pure lazy.

Depending on your contract FOB...etc... just make sure the transport carrier has coverage equaling your investment

If not, then let then know that carrier is unacceptable and put all of this in writing!

[Al Golden]

It's important to understand several points:
1. You have an insurable interest in the yacht as soon as you put a deposit down.
2. The dealer SHOULD have coverage on the yacht under a Boat Dealer's Policy (covering their inventory) until she is delivered to the buyer.
3. The policy that a transporter typically has insures them for their liability to the yacht while in their care, custody or control. It will not cover damage to the yacht that is not their fault. i.e. Lightning as an example.
4. Any lender involved will require coverage to be in place before they release any funds.

So, you really should acquire the coverage immediately upon contracting but, in reality, most coverage begins on the date of the closing.

Fair winds,

Al Golden
International Marine Insurance Services

[Vasco]

The minute you own the boat! I don't really understand what the problem is as the cost of insurance is negligible when compared to the cost of the boat. Just a question for insurance savvy folks, does the normal boat policy cover you when the boat is being transported overland.

[David M]

As soon as you legally own the boat. If someone else owns it then that is their responsibility to have it insured.

As a practical matter, I would get it insured now so you never have to deal with finger pointing as to who is responsible if something happens.

[Al Golden]

>>does the normal boat policy cover you when the boat is being transported overland.<<

Ahh, the world of nomenclature....

The insurance industry generally distinguishes between "boat policies" and "yacht policies". Most often, the dividing line is at 26'.

So, when you ask about a "boat policy", the answer is yes. If you ask about a "yacht policy", the answer gets complicated:
1. Some don't without a specific endorsement.
2. Some do, but limited to somewhere around 350 miles, unless you buy the endorsement.
3. At least one does without limitation.

Al Golden
International Marine Insurance Services

[deluxe68]

Originally Posted by Vasco

The minute you own the boat! I don't really understand what the problem is as the cost of insurance is negligible when compared to the cost of the boat. Just a question for insurance savvy folks, does the normal boat policy cover you when the boat is being transported overland.

The problem is that what could happen to me if the truck driver causes an accident during delivery. It is not about the extra few weeks of insurance premiums.

[Vasco]

Originally Posted by deluxe68

The problem is that what could happen to me if the truck driver causes an accident during delivery. It is not about the extra few weeks of insurance premiums.

I don't understand this post. If the truck driver causes an accident what's it got to do with you? Your boat is just freight. Your only interest should be that your boat is properly insured.

[Tempest245]

Who owns the boat? do you have a title for it yet?

I'd lean on the salesman at the dealership to get straight answers!! Yesterday!
If he can't provide them...go to the owner of the dealership...if that doesn't work go to the manufacturer.....hell.....in this economy they should all be kissing your butt..everyday for buying a new boat from them...."I don't know" is not an acceptable answer...to who's commissioning the boat...

I've never shipped a boat. But, in business I specify that all goods shipped to me are F.O.B. my destination. meaning, I don't own it until it gets here and I sign for it. If it falls off the truck literaly or figuratively, or gets hit by lightening ...it ain't mine.

I believe you take possesion and liability at time of closing as AL Golden has stated.
I clarify that, for sure...though...who knows what was signed?

Good Luck.

[nautical62]

QUOTE=deluxe68;305846]The problem is that what could happen to me if the truck driver causes an accident during delivery. It is not about the extra few weeks of insurance premiums.[/QUOTE]

If you have not insured the boat, what may happen is you will have to sue the trucking company for the loss of your boat, which may or may not go well and may take along time. If it is insured and your insurance covers transportation, then you will hopefully get paid by your insurance company and the transportation company and your insurance company can duke it out for months which also may or may not go well, but it's not your concern. I prefer the later....

[Pblais]

You have a contract to purchase with certain monies deposited now. You have no insurance policy now. Bridging the gap between delivery and now is covered by a lot of legal paperwork. The purchase of a policy today won't undo what has been already done with your signature on a contract. No policy just covers any old thing that might happen no questions asked. Unless you can get some help sorting this all out you need to consider prayer as your only protection. The time clock is ticking and if nothing bad happens all the other players walk away free and happy. You on the other hand take all the consequences no matter what happens. It's about the contract and then about the insurance. Should you own the boat FOB then it is your boat even if you never saw it or signed for it. It's the contract first and insurance after that.

[GordMay]

In North America, “FOB destination” (or “FOB destination, freight prepaid”) is the equivalent of the European “DDU destination”.
The Euro' designation “FOB” is VERY different from the same N.American definition.
Be very careful in understanding the terms, and their attendant implications, of your contract.

[Hyprdrv]

Sounds like this is pritty screwed up.

"He just told me I need to have the policy start the moment the boat leaves the factory."
Sounds like you are taking possession of the boat the minute it leaves the factory, not at the dealership where you bought the boat. This isn't the way I would think it would be done. Have you signed a release for the boat? FInal Payment? Inspected it for damages before shipping? Insure that all equipment bought is on board? If so then you better get the insurance.
Think about a new car purchase. Did you take ownership at the factory?

"This makes no sense to me, it seems to me that the trucking company would have to be liable while they have the boat. Or the dealer/broker would own the boat while in transit. What is the normal process: start the policy leaving the factory, when the boat arrives at the dealer, after the boat is commissioned, or after the sea trial?"

Correct! Your taking possession the moment you sign the exceptance agreement and make the final bank transfer. Not before. That's when the insurance starts.

If it was me I'd call the lazy ass at the dealer and tell him to cancel the sale and not answer the phone for a day or 2.

Steve

[GordMay]

The ads, I’ve seen, for new Beneteau’s have all been either:
FOB Factory, Marion, S.C. (US built)
FOB East Coast port of entry (French built)
In either case, YOU own the boat once it’s loaded on the truck. From that point on, you (the buyer) assume all the inherent risks and burdens of transportation, including loss, damage, or delay.
The cost of freight may either be pre-paid & allowed (included in your purchase price), pre-paid & charged (billed as an extra), or Extra (not included, you pay shipper).