Should there be mandatory liability insurance for boats?

[boatpoker]

Insurance is based on a pool. i.e. risks are spread out over all insured boaters and rates are based on that plus profit.

So if 50% of boaters carry insurance, in fact they are paying for the uninsured too because they can damage an insureds boat and walk away.
Usually the uninsured don't have enough money to make suing worthwhile. So the insurance pays out and the insured 50% pick up the entire tab while the irresponsible pick up another boat from the dump and go on their merry way.
Is that how it works ?

[surf_sail]

Originally Posted by boatpoker

Insurance is based on a pool. i.e. risks are spread out over all insured boaters and rates are based on that plus profit.



So if 50% of boaters carry insurance, in fact they are paying for the uninsured too because they can damage an insureds boat and walk away.

Usually the uninsured don't have enough money to make suing worthwhile. So the insurance pays out and the insured 50% pick up the entire tab while the irresponsible pick up another boat from the dump and go on their merry way.

Is that how it works ?

Sort of except your analysis assumes everyone has hull insurance. In world of only liability insurance the insurance pays nothing when an uninsured hits another boat.

Keep in mind that total expenditures for accidents are significantly greater in a hypothetical world of 100% insurance vs one with no insurance. In the 100% insurance world not only do premiums pay cost to repair and insurance co. profits (as you mention), but just as importantly you have to pay for insurance sales, claims adjusters, and other administrative costs. I haven't looked at data, but my guess is in the 100% insurance world the effective accident costs (paid mostly via premiums) is at least 50% greater than in the world with O% insurance. One also needs to consider the moral hazard of insurance, in that people that are insured on average act a bit more recklessly than if there is no insurance - this would further increase total costs in the 100% insurance world.

[surf_sail]

Originally Posted by boatpoker

Insurance is based on a pool. i.e. risks are spread out over all insured boaters and rates are based on that plus profit.



So if 50% of boaters carry insurance, in fact they are paying for the uninsured too because they can damage an insureds boat and walk away.

Usually the uninsured don't have enough money to make suing worthwhile. So the insurance pays out and the insured 50% pick up the entire tab while the irresponsible pick up another boat from the dump and go on their merry way.

Is that how it works ?

One more points. The vast majority of claims are likely less than $5,000. For these you can take the other party to small claims court (in the US). You'll be hard pressed to find a boater without $5,000 in assets. Also in theory you could take a claim against future earnings but I'm not sure how successful you'd be doing that in small claims court.

[RPZ]

No. And no.

I already pay taxes that fund everything the USCG does.

[boatpoker]

Originally Posted by surf_sail

One also needs to consider the moral hazard of insurance, in that people that are insured on average act a bit more recklessly than if there is no insurance.

I would surmise that people who choose insurance would be among the more responsible elements.

[boatpoker]

Originally Posted by surf_sail

You'll be hard pressed to find a boater without $5,000 in assets. Also in theory you could take a claim against future earnings but I'm not sure how successful you'd be doing that in small claims court.

You mean like the couple who lost their keel last week in Florida with $90 in their pockets. Of course after begging on gofundme I understand they now have about $16k so maybe you're right after all

[surf_sail]

Originally Posted by boatpoker

I would surmise that people who choose insurance would be among the more responsible elements.

That's certainly not the case in a world of mandatory insurance.

Please note that I didn't say people with insurance are less responsible. I said on average an individual that has insurance will act more recklessly than if that individual had no insurance.

[HopCar]

I’m in favor of mandatory liability insurance. You have a responsibility to not harm others. Hundreds of boats, mostly sailboats, sank or went ashore and were abandoned during hurricane Irma. The tax payers are stuck paying for the removal of most of these. The ones that went ashore on private property are costing the land owners thousands of dollars to get rid of them. It’s just not right.
Florida Waterways Threatened By Hundreds of Boats Wrecked During Hurricane Irma | Miami New Times

[seandepagnier]

Originally Posted by Montanan

Desiring your thoughts regarding boat owners' responsibility as to liability for recovery, r

Presently States require that vehicle owners have minimum liability insurance for land transport vehicles operating on public roads and lands. It seems that similar requirements should apply to water transport vessels, perhaps enhancing enforcement by mandating proof .

Yes, there should be liability insurance for motorized vessels.

non-motorized vehicles do not require insurance operating on public roads. non-motorized vessels should not require insurance.

[sailorchic34]

A minor point of order, Liability insurance covers damage to other peoples property that is damaged by your boat. It generally does not cover damage to you boat, removal of the boat, salvage, disposal, etc.

As to the damaged and sunk vessels from the hurricanes, I'm sure some boats had full coverage, but then again many do not. I've always had liability, BTW, Others are removed by FEMA, much like FEMA paying home owners for homes damaged in the storms. Sort of what FEMA is about.

[sailorchic34]

Originally Posted by surf_sail

You'll be hard pressed to find a boater without $5,000 in assets. Also in theory you could take a claim against future earnings but I'm not sure how successful you'd be doing that in small claims court.

HAHAHAHA. Sorry I know LOTS of boaters with less then $1000 to their name. My 46 year old boat is near about the sum total of my assets. That and a few hundred dollars cash is it for me. You would find many a poor boater, to be judgement proof, who have no assets that can be claimed and no future earning as many are retired and generally retirement funds (social security, etc) can not be garnished.

Yes there are many boaters with plenty of funds and full coverage, but they normally don't anchor out that much.

[boatpoker]

Originally Posted by surf_sail

That's certainly not the case in a world of mandatory insurance.

Please note that I didn't say people with insurance are less responsible. I said on average an individual that has insurance will act more recklessly than if that individual had no insurance.

I believe the opposite. I believe responsible people purchase insurance because they are responsible people.

[pcmm]

Originally Posted by boatpoker

Again .... Almost 30 yrs and over 20,000hrs. of deliveries and cruising in all the Great Lakes and have never been asked for proof of insurance unless booking for the season.

No worries, just different experiences. I went down the Hudson this fall and that was my experience! Definitely on Lake Ontario you'll get asked for insurance even for Transient dockage. Been that way for a very long time, Specially the closer you get to Toronto. The further east you get the the more lax I've found they get about it.

[robert sailor]

Originally Posted by surf_sail

One more points. The vast majority of claims are likely less than $5,000. For these you can take the other party to small claims court (in the US). You'll be hard pressed to find a boater without $5,000 in assets. Also in theory you could take a claim against future earnings but I'm not sure how successful you'd be doing that in small claims court.

So your sitting in the San Blas islands and some screwup runs into you...please if you would...direct me to the small claims court.

[surf_sail]

Originally Posted by robert sailor

So your sitting in the San Blas islands and some screwup runs into you...please if you would...direct me to the small claims court.

You think panama is also going to require mandatory liability insurance as per the topic of this thread? The discussion is regarding the US.