Boat Insurers: Cartel or not? Time to leave BoatUS?

[tradrockrat]

Originally Posted by rslifkin

Not quite. True self insurance would involve having the money set aside to cover the cost of an incident, particularly if you're self-insuring for liability.

I always shake my head when people assume I'm just incompetent and cheap.

I bought my 1978 Tayana in March this year. I'm in a marina in Texas. Even getting liability only was tough! I was turned down due to age and - in Giecos case - LENGTH of the boat!?!?!

I got my liability eventually, of course, and I've put 8K aside (so far) in a bank account for future "insurance". This is called "Self-insuring", not "no insurance". I take those premiums everyone else gives to the insurance company, and add as much as I can afford on top I give it to my bank account each month. This first year is a HUGE risk to me, but by this time next year, I'll have 25K in the account for a boat I paid 26K for, and if - like most of you - I don't have a "claim" for a few years, I'll eventually have enough to buy a quality used TY37 in cash if mine gets destroyed by the Gods.

Then I'll leave it there until a lightning strike hits, or a storm or whatever. and keep the liability only insurance for times I need to be hauled or stay at a marina for a while.

I did this because they WON'T insure me here in Texas anyway! So why give them money I don't have to?

[Creedence]

Experience has taught me first hand that insurance really is a necessary evil. So much so, that I’m now willing to drop the “evil” and embrace it.

I sold a Lancer 36 to a nice guy in Hawaii back in 2006. The guy was a carpenter who worked hard and saved up to buy his dream boat with cash. He was so thrilled to be living his dream- being a liveaboard in Honolulu.

He took it out for the very first time.... and ran it hard aground on the reef just off Waikiki beach. In addition to the salvage costs, the state fined him $100,000 for the reef damage. The poor guy was uninsured.


For my part, I have regretfully needed to make a claim 10 years ago, and they made me whole- despite the fault being my own.

It’s hard to embrace a big expense when you know you’re unlikely to use it, but I can say from experience, you will not be crying over the premium if the day comes when you need to make a claim.

[sailorboy1]

Originally Posted by tradrockrat

I got my liability eventually, of course, and I've put 8K aside (so far) in a bank account for future "insurance". This is called "Self-insuring", not "no insurance".

Sorry, but is just liability insurance with a small amount of savings. It isn't "self insuring".

But I could care less if people carry insurance other than liability. Matters nothing to me if their boat get crashed and they can not afford to fix it. As long as if they hit me that they can pay to fix MY boat! The problem with the "self insurers" is when they damage each others boats and try to bleed money out of a rock.

[tradrockrat]

Originally Posted by sailorboy1

Sorry, but is just liability insurance with a small amount of savings. It isn't "self insuring".

But I could care less if people carry insurance other than liability. Matters nothing to me if their boat get crashed and they can not afford to fix it. As long as if they hit me that they can pay to fix MY boat! The problem with the "self insurers" is when they damage each others boats and try to bleed money out of a rock.

I totally get your point. I think many people feel as you do. So what is self insuring? I have what you want in others - liability - so what's the hangup? Definitions?

I get that you don't like it, but I literally CAN NOT get more than liability. I checked. Permanent residence in Texas on a boat made in 1978. I got 7 nopes and one liability only.

And choosing to present my post as a small savings isn't accurate. I'm doing what everyone else is doing - paying in monthly to a program that will pay to repair my boat if it is damaged. I have no intention of bleeding a stone if an uninsured boater hits me. I plan on fixing my boat! In the unlikely event I damage another boat, I have liability.

It works because my boat will never be valued over 75K - I can literally buy 4 different "turn key" Tayanas for sale today for $75K or less (each, of course...lol).

Again - I get where you're coming from, but I respectfully disagree with you.

[Mediaguy]

Warren Buffet has a lot of money invested in the insurance industry and took the time to look at if there were any more, or more extreme weather events today than in the past. His conclusion was that there are NO more events now than in the past. When asked why insurance rates were going up - quote: "their profit taking".


You can see the interview here:

https://www.youtube.com/watch?v=HSwH0mK5o8g

[sv Stella Maris]

Wallaby:

Most of us in the Caribbean all received the same 20% increase.

This is the busiest hurricane season EVER predicted by National Hurricane Center out of Florida, part of NOAA.

The actuarial changed, and we are paying the difference. Some boats were even dropped.

Be happy you are covered at all this season until end of year passes us by.

I called every broker and major insurer in July...all with the same premiums or not available at all.

Patience...

[lwaugaman]

Of all of the costs associated with owning a boat, insurance is one of the most reasonable IMO. Our boat is insured for $450k (10% deductible) and the premium is $1700/yr.

By contrast, my Harley Davidson motorcycle ($30k value) annual premium is $1400.

We use Traveler's for the boat BTW

[Nepidae]

All the talk about the cost and no one I read has said anything about the payout of insurance.

I've heard of people with insurance that had to negotiate with their insurance company to get a payment when there was damage. I've never heard (please enlighten of personal experiences) of anyone negotiating with BoatUS.

Maybe now that BoatUS is a GEICO company that might happen.

We purchased our 43' trawler in '10 and have been insured since with BoatUS. This yr they dropped some of my coverage due to 'credit' (I'd think 760 is good and have never had a claim).

Being a veteran, I have USAA for home & auto and called them to see if they'd insure the boat. They said they would so at the end of the season I'll be talking to USAA. They have done a great job with homeowners damages due to storms.

As always, Caveat Emptor. You are responsible for finding the best for you, regardless as to what, and if Warren looses enough customers, he is astute enough to look at why and make changes.

[TabbyCat]

Originally Posted by Wallaby

I However, I was informed the reason was 'policy was re-written' with no other explanation. This would not be the first time that an industry has taken advantage of a situation to dramatically increase its profits by operating in a non-competitive manner--which is the reason why there are anti-trust laws. 'Rewritten' to me, is a red flag. Customers can ask for more information--I tried.

Have you made any changes to your policy? That is usually why a policy is re-written. For example, a change in your primary mooring address (your marina), a change in your mailing address, or a change in your navigation? Any material change in risk may require a policy to be re-written.

[daveball]

Sixteen years sailing offshore with no insurance.

[StuartWeibel]

I agree with those that note weather events of recent years have increased payouts by insurers and resulted in increased premiums.

At the same time, it is not the case that all insurers are equivalent.

I left BoatUS when they told me that sailing the inside passage from Seattle to Alaska would nearly double my premiums and require a rigging survey ($500+).

A dockmate pointed me towards the local office of American Family Insurance, who offered a reduced premium and no issues with the inside passage as long as I stayed within 100 miles of shore.

I have no experience regarding the other end of the business (paying of claims), as I've never had occasion to file one. My major objective for my insurance is for liability and to satisfy the wharfinger (see liability).

But the major point is... not all insurers are alike, and having 'boat' in the name assures nothing. Consider carefully the spectrum of objectives for your insurance.

[Nicholson58]

Originally Posted by SeeMonstrEd

For those of us in the Caribbean BoatUS/Geico is dropping all policies. We are forced to look elsewhere.

I have found several quotes from other companies. All requiring an out of water survey and costing up to double of what I paid this year.

I found one from a company out of Costa Rica called ION that is offering better coverage for 1/2 what I paid this year. I have never heard of them and am not sure I should trust this.

Has anyone else heard of ION Insurance or Edward Williams SL out of Spain?

For Caribbean insurance:

Happened to us every year. Lloyd’s, Geico, others. We are now with ANJO in Antigua. They have a decent reputation and were less than half the cost of Jackline. We walked in the door in Faulmouth Harbor with our recent Trinidad survey in hand. Interviewed with the nice lady. No problem. They even permitted us to stay in Jolly Harbor Marina on the hard for hurricane season. This was a great serendipity. We normally haul in Trinidad but C19 border closure made Jolly the only option.

[TabbyCat]

Originally Posted by Mediaguy

Warren Buffet When asked why insurance rates were going up - quote: "their profit taking".

I'm a fan of Warren Buffet, he speaks straight, but I don't believe he actually said that exact sentence in the interview. Also he was talking generally about insurance for buildings & homes in the USA, not boats in the Caribbean. That aside, property insurance companies are not non-profit organizations, despite their use of the term "membership". You don't have a "right" to a boat policy at a low cost like you would with health insurance. The market determines the rates on property policies, and rates are driven by the ability of the underwriters to make a profit. They do that in two ways:
1) Underwriting Profit: Charging a little more for the premiums than they pay out in claims, so the net amount is their profit. It is often a surprisingly low margin % - in some years it is even a net loss.
2) Investment Profit: The companies invest your premium payments in the stock & bond markets. This is where they make the big dollars. However, if those markets appear too risky, they will not invest, and thus they must increase their rates so they can make a profit on the underwriting side.

[TabbyCat]

Originally Posted by SeeMonstrEd

Has anyone else heard of ION Insurance or Edward Williams SL out of Spain?

You really should do a search on that, lots of threads about them!

[skenn_ie]

Originally Posted by Shrew

The premium increase has nothing to do with your lightening strike. This is how mutual insurance works. The total premiums collected cover the policy payouts. When the payouts increase, cost is distributed equally amongst it's members. Rather than paying for an entire boat, everyone pays just a little bit.

If it is a "mutual", premiums should be reduced occasionallly ! They never seem to.