What You Should Know About Commercial Boat Insurance

Vessels Covered by Commercial Boat Insurance

Commercial boat insurance can apply to any watercraft used for commercial purposes. For clarification on marine business insurance qualifications and requirements, you can speak to a dedicated boat insurance agent before committing to a policy.

Commercial Fishing Vessels

Protect your livelihood with insurance for fishing boat businesses. Whether you’re fishing for cod, trapping crabs, or harvesting everything in between, commercial boat insurance can provide security for your vessel, your employees, any passengers you have, and your precious cargo.

Charter Boats

When transporting passengers on a chartered boat, you must have the right insurance to protect them as well as your vessel, employees, and business. If a passenger gets injured on a fishing tour or your boat is damaged by a guest, a commercial boat insurance policy can help you cover the cost.

Boat Rental Businesses

Boat rental business insurance can help you protect your vessels and your business in the event of any collisions, injuries, or legal action.

Submersibles

Vessels that venture underwater can also be covered by commercial marine insurance, provided they are used for commercial purposes. Such submersibles include:

• Tourist submarines
• Underwater observatories
• Expedition and sport diving businesses
• Autonomous underwater vehicles (AUVs)
• Marine and undersea energy businesses

Other Water Vessels

Commercial boat insurance can also apply to a number of other water vessels, including:

• Sightseeing and tour boats
• Ferries
• Tugboats
• Inshore/offshore fishing vessels
• Cruise liners
• Oil barges
• Tankers

What Does Commercial Fishing Insurance Cover? 

Commercial fishing vessel insurance covers a range of potential issues that these types of operations typically face. This includes everything from damage to the boat itself to any injuries or damages caused by the boat or its operation. It offers financial protection related to the vessel and its equipment.

Some common types of coverages in commercial fishing boat insurance include:

• Hull Insurance: Covers physical damage to the boat, including the hull and machinery.
• Machinery Coverage: Protects against mechanical breakdowns
• Protection and Indemnity (P&I): Provides liability coverage for bodily injuries and property damage caused to others.
• Crew Coverage: Ensures that medical and liability expenses for the crew are covered in case of work-related injuries. 

What is Commercial Marine Insurance?

While commercial boat insurance specifically protects vessels, commercial marine insurance offers broader coverage for a range of maritime businesses. This type of insurance is designed to cover the transportation of goods and passengers, as well as the operation of shipping services and port facilities. 

Another way to think of it is that commercial fishing boat insurance is limited to a single vessel. Commercial marine insurance, on the other hand, covers a variety of maritime business operations and logistics. 

Understanding the nuances between these two can help maritime business operators ensure they have the right type and scope of coverage to mitigate the unique risks they face.

Who Needs Commercial Marine Insurance? 

A commercial marine insurance policy is ideal for businesses that operate in the maritime industry. It is not limited to coverage for boats and vessels alone. Whether you transport goods or offer charter services, this type of coverage can help offer financial protection against damage and loss to ships, cargo, and even terminals.

Businesses That Rely on Overseas Shipping

Many businesses rely on overseas shipping for the transportation and distribution of goods. However, these businesses do not necessarily own the boats that are used for transportation, necessitating commercial marine insurance over boat insurance to protect the transported products. Businesses in this group may include:

• Manufacturers
• Importers
• Exporters
• Freight forwarding companies
• Commodities traders

Marine Service Providers

Some businesses play essential roles in the maritime industry without owning water vessels themselves. Because these businesses work with boats and other vessels, it is important that they obtain sufficient commercial marine insurance so that they can safely and confidently perform their duties. Marine service providers consist of a range of professions and businesses, such as: 

• Shipbuilders
• Vessel manning services
• Ship dealers
• Terminal operators
• Freight hauling or forwarding services
• Maintenance and repair workers
• Stevedores
• Marine storage facilities
• Shipyards 

Marine Transportation Providers

Businesses that operate any water vessel for commercial purposes should obtain commercial marine and boat insurance to protect their business, vessels, employees, and passengers. 

Commercial Marine Insurance Coverage Options

There are many options for commercial marine coverage. What your policy includes may vary depending on the specific needs and features of your business. Maritime companies should consider the following coverages to protect their businesses.

General Liability

Every maritime business should obtain marine liability insurance. A marine general liability policy offers coverage for claims involving:

• Bodily injury
• Property damage
• Advertising injury
• Reputational harm

Bumbershoot Insurance

Specific to the marine industry, bumbershoot insurance is a form of excess liability for situations that exceed the limits of a general liability policy.

Ocean Cargo

Damaged, lost, or stolen cargo can be costly and detrimental to your business’ reputation. Getting ocean cargo insurance can help you cover any costs relating to missing or damaged cargo as a result of incidents including

• Improper loading
• Rough handling
• Inclement weather
• Adverse atmospheric conditions

Hull and Machinery

With hull and machinery coverage, you can ensure that any damage done to the hull or machinery of your boats will be insured. In addition to the specified machinery and hull, this type of insurance also usually covers:

• Personal property
• Propulsion equipment
• Permanently attached equipment
• Unattached equipment

Protection and Indemnity

An essential component of commercial boat insurance is a protection and indemnity policy. With this type of coverage, you can get coverage for bodily injury claims from passengers, crew members, and anyone else on your vessel. This policy also offers coverage for vessel operation liability and property damage.

Equipment Rental and Sales

If you rent, sell, or charter boats and related equipment, you should have an equipment rental and sales policy in place. With this policy, you will have coverage for repairs, replacements, equipment breakdowns, and accident cleanup.

Uninsured Watercraft Coverage

In the event that one of your insured vessels collides with an uninsured boat, having uninsured watercraft coverage will help you cover any costs or losses that result from the collision.

Workers’ Compensation

Maritime workers operate in a high-risk environment, so a workers’ compensation policy is essential for protecting your employees and ensuring they are cared for in the event of injury or illness.

Maritime Employers Liability Coverage

If you do not own every vessel used for your business, a maritime employers liability (MEL) policy is important to have. This type of coverage offers protection for your employees whenever they need to work on or from a non-owned vessel. MEL policies are also common among vessel owners whose protection and indemnity policies do not include all employees.

Wreckage Removal

In the unfortunate event that your vessel is badly damaged or sunken, wreckage removal insurance can help you cover the costs of removal and disposal. Insurance for wreckage removal can also help maritime business owners cover clean-up and containment expenses regarding pollution or contamination resulting from the wreckage of their boat.

Commercial Marine Insurance for Other Maritime Businesses

While commercial boat insurance specifically applies to maritime businesses that own or utilize water vessels, other marine businesses can still acquire specialized commercial insurance through World Insurance to protect their assets and operations.

Marinas

Marina owners often face numerous hazards to their property that can cause damage to their docks, piers, bulkheads, and buildings. Commercial marine insurance for marinas often includes coverages such as:

• Commercial property
• General liability
• Commercial auto
• Protection & indemnity
• Longshore and harbor workers liability
• Pollution coverage

Marinas may also require coverage for boat sales and building operations.

Boatyards

Boatyards offer safe harboring to water vessel owners, and as such, they should have sufficient commercial marine insurance to keep stored property and their premises safe. Marine general liability coverage is essential for boatyards, but other coverage options may include:

• Premises liability
• Building and property coverage
• Tools and equipment insurance
• Docks and pie coverage
• Protection and indemnity

Marine Laborers

Marine laborers who do not necessarily work on boats or water vessels can also be covered under commercial marine insurance. Examples of marine laborers include:

• Artisans
• Repairers
• Mechanics
• Electricians

Do You Need Commercial Boat Insurance? 

Regardless of whether you own a fishing boat or transport goods across the open sea, marine operations pose unique risks. Perhaps most pressing are environmental hazards, especially hurricanes and high seas that can cause damage to vessels no matter if they’re being used or docked.

There is also the potential for collisions and groundings. These accidents can result in costly damages to the vessel and environmental contamination, leading to legal liabilities. Similarly, mechanical failures and fires pose a significant risk that can immobilize vessels.

Another unique challenge for commercial ships is the threat of piracy and theft. In certain regions, piracy can be a severe threat that leads to loss of goods, ransom demands, and harm to crew members. However, theft of equipment and cargo can also happen in seemingly secure locations.

With so many potential risks, commercial fishing boat insurance or marine insurance can provide priceless peace of mind. This insurance can help manage financial exposure from unforeseen events, ensuring that your marine operations can recover and continue after an incident.

How much is commercial boat insurance

At World Insurance, we strive to provide an insurance policy that addresses your needs and accommodates your budget. Your commercial boat insurance cost will depend on a number of factors, including:

• The vessel’s value, age, and type
• Your boat’s engine type and maximum speed
• The anticipated area of navigation and travel distance
• Your vessel’s claim history
• The intended use of your vessel

If you want to get a better idea of how much your commercial marine insurance will cost, please connect with one of our agents who will be happy to discuss your policy needs and options.

World Insurance also offers personal boat insurance if you are looking to protect a non-commercial water vessel.