While it may be tempting to cancel your boat insurance policy in the off season to save a few dollars, it’s important to know that your boat can still face risks whether it’s in your yard or in a storage facility. Fire, flood, vandalism and theft aren’t limited to the warmer months; they can be year-round threats.
Depending on the size of your boat, some insurance companies require "lay up" periods. A lay-up period is usually for boats exceeding 26 feet and defines the months that the vessel is out of active service. During the lay-up period, the vessel is out of commission and is not used for any boating activities. In New England, the typical lay-up period is from October to May. It's important to know that if you put your boat in the water during the lay-up period, there would be no coverage for an “in the water “ loss during this time.
Contrary to popular belief, the amount of claims filed during cold-weather months is shocking. Over the last three years, nearly two out of every ten claims filed from Northern states were filed during the fall and winter months. Without the proper coverage, boaters would have to pay for these damages out of their own pockets.
Boaters could also be held responsible for injuries that occur on or around their boats, even during the lay-up period, and even if the injured person was there illegally. Without liability coverage - which pays for injuries to other people or damage to their property if you cause an accident - you, and not your insurer, could be legally responsible for damages or the injured parties' medical bills.
Your insurance carrier may not be eager to renew your boat policy if you cancelled the previous year. In many cases, once you cancel a policy, that company will not insure you again for a period of time. If you have financed your boat, your lender may require year-round coverage.
By cancelling a policy for the winter months, you will most likely pay more than what you would have by keeping the policy in effect. You may actually save some cash if you keep your boat policy all year. If you have other insurance policies with the same carrier, you could qualify for a multi-policy discount. If damage should occur after cancelling your policy, then you'll be paying the entire amount to repair damage to your boat since you won't have any coverage.
Don’t forget the critical need to have adequate coverage on boat trailers and boat lifts.