Boats

If you own a boat, you know you need to protect your investment with suitable insurance, as well as protect your crew and, finally, guard against the adverse effects of liabilities you may incur towards third parties following a claim, beyond the compulsory insurance required by law for all motorboats and for sailing boats over 6 metres in length.

In this article we will guide you through the compulsory and optional cover of boat insurance, and explain how a professional insurance broker can help you obtain the best cover for your boat.

Compulsory cover

In Spain, all boats must be covered by an insurance policy that includes a series of compulsory covers. These are:

Third-party liability:

This cover pays for damage you may cause to third parties while sailing, such as collisions with other boats or damage to port facilities.

This requirement is regulated in RD 607 N of 16 April.

It sets the following minimum limits for personal injury, death or bodily harm:

• €120,203 per victim.
• €240,404 per claim.

And for property damage or financial losses:

• 96,161 €.

In general, although these limits comply with the law, we consider them very insufficient given the damage boats can cause to third parties and the liabilities that may arise, for which the shipowner, operator or skipper could have to answer personally. We therefore always recommend that our clients also take out voluntary third-party liability insurance.

Accidental pollution liability:

Since the entry into force of the Law 14/2014 of 24 July on Maritime Navigation, accidental pollution liability cover has also become compulsory.

Optional cover

In addition to the compulsory cover, there are a number of optional covers you can add to your boat insurance for extra protection. These are:

Voluntary third-party liability:

This cover lets you raise the total limits for property damage and personal injury above the minimums required by the Compulsory Insurance.

The right limits will depend on the nature of the boat, for example its cruising speed, the navigation area, etc. In any case, we consider that the right limits should start at €300,000 per victim and €600,000 per claim.

Personal accident cover for occupants:

Personal injury suffered by the occupants of the boat during the claim.

Own damage:

This cover pays for damage to your own boat, such as collisions, vandalism or theft.

Extended navigation area:

Navigation limits should be adapted to our needs, such as the skipper’s qualification.

Machinery breakdown:

This cover pays the cost of repairing your boat’s machinery, such as the engine or hull, in the event of a breakdown.

Towing and travel assistance:

This cover pays for rescue and assistance costs in an emergency on the high seas.

Legal protection:

This cover pays the legal costs you may face in a dispute relating to your boat, such as defence and claims for damage against third parties.

Total loss or abandonment:

Although it is an own-damage cover, it can be taken out as a first cover that only responds if the damage is total.

Wreck removal:

If the boat suffers a claim, in addition to the loss caused, the authorities may require the boat and its wreckage to be removed from where they ended up.

Personal belongings:

Covers damage to or loss of the personal belongings of the crew and occupants of the boat when a claim occurs.

Training and participation in regattas:

This cover is expressly excluded from the compulsory cover and must be taken out separately.

Towing water skiers and other floating objects:

If you do these activities when sailing, it is important to make sure they are included in your cover.

The following are also important factors when underwriting a policy:

1. The deductibles accepted on own damage.
2. Type of policy wording: it may be the one drafted by the company itself or it may follow the English Clauses.

Why should I take out my boat policy through a broker?

Although it is possible to buy a boat insurance policy directly from an insurer, working with a professional insurance broker can offer you some additional benefits. Some of the added values of working with an insurance broker are:

Experience and knowledge – A professional insurance broker has extensive experience in the insurance industry and can help you select the right cover for your boat.

Negotiation on your behalf – An insurance broker can negotiate with insurers on your behalf to obtain the best rates and policy terms.

Personalised advice – An insurance broker can give you personalised advice to help you understand your policy’s covers and how they work.

Claims management – In the event of a claim, an insurance broker can help you manage the claims process with the insurer.