Repair estimate higher than insured value - any experience?

[basssears]

Unfortunately our boat got away in a wind event a few weeks ago, sheared both bow cleats off and escaped her mooring, went walk about for a few hours. She's full keel / built like a brick sh*t house so is still floating, but somewhat the worse for wear (fiberglass damage, lifeline stanchion damage) but I would say fundamentally sound.

We got her hauled, had a damage survey done, and an estimate provided by the yard (reputable yard but IMO looking for a good job to sink their teeth into).

Estimate came in about 35% higher than the agreed value we have with our insurance carrier (Traveler's).

Has anyone been in this position that can shed a little light on what to expect? Traveler's got the estimate this morning so I imagine I'll know soon, but I'd be curious to hear other folks' input.

Do we think this is just an opening "bid" by the yard to try to get a good payout and they'll negotiate with Traveler's?

I know insurance could just "total" the boat and give me the agreed value as a check, but then what happens to the boat?

The yard CEO says that insurance companies will generally pay a claim up to about 80% of agreed value, if I just took a check for 80% of agreed value and fixed what could be fixed by the yard (the serious stuff like below the waterline, things that need to be done to keep the interior dry) and tried to do the rest myself (gel coat repairs, rerig lifelines with dyneema etc) how does that work with insurance going forward... is Traveler's going to drop me, or will they not insure the boat at that amount anymore because it's not been completed fixed?

I know only my insurance company has actual answers to the above, but the more I hear other peoples' stories the more prepared I'll be when I talk to the insurance company and the yard.

TIA,

-- Bass

[ausnp84]

Originally Posted by basssears

Unfortunately our boat got away in a wind event a few weeks ago, sheared both bow cleats off and escaped her mooring, went walk about for a few hours. She's full keel / built like a brick sh*t house so is still floating, but somewhat the worse for wear (fiberglass damage, lifeline stanchion damage) but I would say fundamentally sound.

We got her hauled, had a damage survey done, and an estimate provided by the yard (reputable yard but IMO looking for a good job to sink their teeth into).

Estimate came in about 35% higher than the agreed value we have with our insurance carrier (Traveler's).

Has anyone been in this position that can shed a little light on what to expect? Traveler's got the estimate this morning so I imagine I'll know soon, but I'd be curious to hear other folks' input.

Do we think this is just an opening "bid" by the yard to try to get a good payout and they'll negotiate with Traveler's?

I know insurance could just "total" the boat and give me the agreed value as a check, but then what happens to the boat?

The yard CEO says that insurance companies will generally pay a claim up to about 80% of agreed value, if I just took a check for 80% of agreed value and fixed what could be fixed by the yard (the serious stuff like below the waterline, things that need to be done to keep the interior dry) and tried to do the rest myself (gel coat repairs, rerig lifelines with dyneema etc) how does that work with insurance going forward... is Traveler's going to drop me, or will they not insure the boat at that amount anymore because it's not been completed fixed?

I know only my insurance company has actual answers to the above, but the more I hear other peoples' stories the more prepared I'll be when I talk to the insurance company and the yard.

TIA,

-- Bass

Howdy,


Sorry to hear it! That sucks.


If it helps, my catamaran was run down by a fishing boat in southern Biscay Oct last year. Repair value was about 50% more than insured value so they (Zurich) paid out full insured value, and then paid the yard £10k to dispose of the boat. I also have a claim for £20k for personal effects, so Zurich are going after the fishing boat's insurer for all costs, plus my £20k.


My bit of advice is strip all your personal effects off the boat now as if the insurance co decide to pay you agreed value / total loss, they then own the whole wreck.


n

[Orion Jim]

Useful info here https://www.cruisersforum.com/forums...ce-241873.html
They don’t pay portions of an agreed value. If the damage estimates exceed the value they pay out the full policy and the boat is theirs. You must contact your agent and read your policy.

[basssears]

Thanks for the replies, I guess I should have clarified, I'm not necessarily looking to maximize the financial angle here (always the best mindset when it comes to boats IMO) it is my desire to keep my boat (keep it out of the landfill, and we're quite attached to it, I don't want to start over).


-- Bass

[Davidhoy]

When the boat is considered a CTL (constructive total loss), the insurance company will generally pay out the agreed or market value, depending upon the policy. Once that is done, they technically own the boat, and are responsible for paying for any disposal costs. They really do not want that responsibility and or those cost, so will often offer you the boat back, as is, for pennies on the dollar. If you choose that option, you can take their check and use it to repair the boat as best you can. Perhaps you can ask the yard, particularly if they are keen for the work, to take a bit less for the job?

Sadly I went through something like this a couple of years ago, it really sucks. Insurance companies are not your friend, and their lawyers are even worse. My boat was hit, while at it's dock, but a 100ft motoryacht and totaled. Their insurance company really screwed me over, particularly their lawyer.

[Bargain Bill]

Its not complicated. You had the boat underinsured.
Take the $$ from insurance and they will consider it a 'total loss' and own it. You can buy it back from them with the proceeds and use the rest to fix r up.
2nd option is take the $$ and go find another boat.
Had a similar event with an airplane and even though the damage was less than the insured amount, they paid me the insured amount, took the plane, and sold it for parts giving them back 80% of what they paid me. Not much I could do.

[zstine]

Let me ask a related question to help the OP. Assuming the repair at 135% agreed value will result in the insurance totaling the boat. And assuming the OP has the option to buy it back cheap (~$1000), Does the title become a 'salvage title' like a car? Will he need to show the boat is sea-worthy, like in a car needs an inspection to show road worthy, which then results in a "Rebuilt" title? In other words, will there be an obvious paper trail that the boat was totaled and likely result in a future reduced value or difficulty in future insurance coverage? Are there added hoops to jump through to get insurance again?

Is there an obvious way to know via title abstract/search that you are buying a previously totaled boat?


Lastly, To clarify... I believe that the insurance company will not agree to pay a smaller claim and not total the boat correct? The OP cannot say "how about you pay 80% the agreed value and call it a day without taking ownership".. that doesn't fly does it?

[Cllewellyn]

In August my 40 YO 27' catamaran was demasted off of Cape Lookout, NC,and I had to drop the mast with sail to the bottom. Fortunately, we were in shallow water and I tied floats to on the mast. There was extensive fiberglass damage to the deck, but no one was hurt and we were able to motor back home. I had purchased the boat for $11k and had insured her for that amount, but had done extensive renovations and improvements over four years. I contacted my insurance company, Progressive, and informed them that if I could retrieve the mast and sail intact, I wanted to repair her, if not, it would be totaled. I mentioned that the mast was in a national park and I was probably liable to remove it. I found the mast and dove on it (in 13 feet of water) and removed the sails. But, the mast itself was full of sand, as it has been down during Hurricane Isaias. At the request of the Progressive agent, I hired Dead Cow Enterprises, a local salvage company, to retrieve it, and they did, although my 130 pound mast had about 300 pounds of sand. A local marine yard fixed the fiberglass, and I had to replace the broken foresail furler with a Seldon, which I was able to do myself. I sent the main invoices to Progressive which totaled $11,279. I received an e-mail saying that the maximum they could pay was $9,999.99. I replied that I would accept that, if I could keep the boat as I am 70 years old and would not be able to replace it. A few days later I received a check for $11,279! I since increased the insurance value to $20k.



I am reporting all this to say that sometimes the Insurance Co. is your friend! Good luck.





.

[grantmc]

Originally Posted by Davidhoy

When the boat is considered a CTL (constructive total loss) ...
Sadly I went through something like this a couple of years ago, it really sucks. Insurance companies are not your friend, and their lawyers are even worse. My boat was hit, while at it's dock, but a 100ft motoryacht and totaled. Their insurance company really screwed me over, particularly their lawyer.

I've had a similar result but my experience with the insurance firm was very positive.

Total constructive loss situation, insurance firm assessed cost of disposal and value of the 'wreck'. Offered me the 'wreck' which I accepted. They simply deducted that value from the total claim value. I took the cheque around to repairer and paid the difference myself. The difference was very small. Repairs were excellent.

The problem I faced was an old boat with a very low value, and repairs (especially parts) being very expensive. But to be fair I accepted that assessments and decision, but found the process very simple, and the insurance staff helpful.

[nortonscove]

My boat actually broke from its mooring a couple years ago and went onto some rocks. Fortunately it's a fin keel boat and simply scraped the finish from the keel and didn't touch the glass or rudder. Once the tide got to its full height we pulled it off and took it to the lift for a look. No damage and no insurance involvement.

A friend of mine did damage his boat and required extensive repairs. His yard asked if he wanted the quote to be high enough to write it off. He said no and that it had taken too long to find the right boat. At this point the quote came in comfortably low enough to ensure that the boat was covered. Wonder if there is a dance sequence that is followed but rarely spoken of.

[ausnp84]

Originally Posted by Bargain Bill

Its not complicated. You had the boat underinsured.

Nope. Often the cost to repair a vessel can actually far outweigh the “fair market value” or “agreed value” of a vessel. It’s very difficult to get a vessel insured for what it’d cost to completely repair it, as opposed to agreed / market value.

N

[boat driver]

travelers is generally a good company. the agv is misleading, as most people underinsure boats because of the premium.
suggest revisit the yard and have them sharpen the pencil.
then call insurance and listen to their offer first, then if interested buy back hull for scrap value and fix. this is where what you saved in premiums just came back to bite.

[skipmac]

Originally Posted by Bargain Bill

Its not complicated. You had the boat underinsured.
Take the $$ from insurance and they will consider it a 'total loss' and own it. You can buy it back from them with the proceeds and use the rest to fix r up.
2nd option is take the $$ and go find another boat.
Had a similar event with an airplane and even though the damage was less than the insured amount, they paid me the insured amount, took the plane, and sold it for parts giving them back 80% of what they paid me. Not much I could do.

Know someone that did this with their boat. Serious hurricane damage that exceeded the insured value. He got full payout and then bought the boat back from the insurance company at a very cheap price and repaired the boat himself.

[CMO Tashina]

Ditto many of the above that older boats cost more to repair than insured value. Mine, a small Morgan OI then 42 years old, was hit by hurricane Michael 2 years ago. Busted out a portlight and separated hull from deck a length of ten foot under rubrail. GEICO totalled it and I bought it back as salvage and repaired it with the insurance money plus about $5,000 more. GEICO then asked for rigging and hull surveys but eventually covered the repaired boat at the surveyor's evaluation, about 3k more than I paid for the boat originally. It really depends on how attached you are to that particular boat whether simply accepting the insurance payout and looking elsewhere or keeping and repairing!

[Clivevon]

Interesting thread. Open market value of boats same model & year as mine is apparently around £30,000. Over the years I have spent "stupid" (but not to me) money on the boat upgrading, renovating & replacing & no way could I buy her equivalent today for that. I have discussed this recently with my insurers (Pantaenius) & we agreed an insured value of £60,000 which would give me a better chance of buying something more like her (but still likely to fall short). My premium has gone up maybe 25% but to my mind there is no point in buying insurance which isnt going to do the job if you make a claim?