Do I Need a Separate Insurance Policy for my PWC?

Adding a PWC to home insurance policy leaves you at risk

One of the most common questions among new PWC owners is that of insurance. Do I need a separate policy for my watercraft, or is it okay to just list it on a rider under my existing home policy?

While a rider on your house insurance may be okay for a canoe, kayak or paddleboard, there are many reasons why powered vessels like PWC are better protected under a specific marine policy.

The biggest issue with residential home policies is that they simply aren’t written with the unique needs of watercraft riders in mind. They never contain the specific language and wording that can make a huge difference in how a claim is handled, resulting in problems such as “named perils” clauses that will only cover loss or damage resulting from things specifically described in the policy. Because homes seldom face the type of exposure to damage that PWC do, house policies don’t account for the types of problems that personal watercraft might face, like being involved in an auto accident while being towed to the lake. If that happens, and those specific perils aren’t named in the policy, you could be out of luck when you try to file a claim.

Another big concern with having a simple rider on a home policy is what insurers describe as depreciated claims settlements. What this means is that the insurance covers the actual cash value of the item – value that depreciates over time. So if you hit a rock and damage the jet nozzle on your three-year-old PWC, your insurance may only be willing to replace the damaged parts with replacements that also have three years of wear and tear on them. Using “new” parts (as will almost certainly be the case, since used parts are virtually impossible to find) means you will have to pay the difference in value between the cost of the new parts and the depreciated value of the parts which were damaged. That could be an expensive difference.

Similarly, riders on your home policy almost never provide for pollution. If your PWC is involved in an incident and there’s a fuel spill, you could be on the hook for an environmental cleanup that could run into thousands of dollars. By comparison, a proper marine policy normally covers things like spills.

When shopping for PWC insurance, it’s best to pay a small amount more and buy an “all risk” policy that provides full replacement cost for all repair parts and labor. Apart from covering your unit against all possible risks for damage and/or loss, a good marine policy will also include coverage for expenses like medical payments arising out of an incident, personal effects, coverage against damage you cause to other property, emergency towing, pollution from an incident, and possibly even salvage and/or wreck removal fees (which can be considerable).

Some policies may even include coverage against loss of use. This could allow you to rent another machine while waiting for repairs to be completed on yours.

The most important thing is to speak with your broker. Insurance coverage varies widely, so check to find out exactly what your own situation is. Better to ask now than to face an unpleasant surprise later.

Riding personal watercraft is all about having fun. The best way to keep it stress-free is by making sure you’re protected by proper insurance coverage. Then you can enjoy the sunshine and fresh air knowing no matter what happens, someone has your back.