Pollution LiabilitycoverageJanuary 15, 2019 by
Tuesday Tips – Understanding Boat Insurance
We will cover several terms in the typical boat policy. Boat insurance is often not regulated like a home insurance or auto insurance policy. In fact most states don’t require minimum limits of coverage; making it even more important to understand your risks.
Why have boat insurance? The most common answer is in case my boat is damaged or stolen. That is important especially for your loan holder. However, the other reason is incase people are injured or property is damaged.
This week, we will discuss
Boat owners may be responsible for any clean-up and containment expenses resulting from fuel and or oil pollution or contamination caused by their vessel.
In addition to those expenses often there can be fines from the state and federal governments. Gas and Diesel dripping while bringing the nozzle to the boat, away from the boat or that splashes back during the fueling process. There are many products available to minimize spills and that absorp that fuel these can be around the nozzel or around the area you are fueling. Other precautions, be sure there isn’t any oil or fuel in the bilge area. Proper maintenance of seals and lines will go a long ways to reducing risk. Another area where pollution fees and fines can occur is, in the case of sinkings, fires and explosions. The Coast Guard requires all owners to notify the Coast Guard or local authorities immediately when oil or fuel is spilled or leaks into the water. It is the owners responsibility to begin containment ASAP.
Fines range from $50 to over $1Million- Some policies have coverage for fines while others exclude coverage for fines, speak with your agent.
It's important that your boat or yacht insurance policy covers your liability for those clean-up expenses because vessel owners are liable under the Oil Pollution Act of 1990 up to the statutory limit (currently $939,800).
Things to look for in your policy: Is the pollution liability limit separate from the liability limit or part of that limit? Are fines and fees included or just the containment and cleanup?
Take appropriate precautions while fueling and maintaining your vessel.