Even though Insurance providers have expanded their coverage portfolio to meet the needs of modern yacht owners, they contractually limit their liabilities in certain areas. Accordingly, each yacht insurance policy has its own definitive set of exclusions, conditions and terms of use.
Dealing in unfamiliar territory, first time boat owners especially, may find themselves caught in a conflict if the exclusions are not communicated properly. It is advisable to consult your insurance advisor for a complete understanding of what is excluded and what could void your cover.
Following is our list of some key general exclusions you should be aware of.
Wear and Tear
Maintaining the upkeep of your vessel is your responsibility. Any damage incurred as a result of wear and tear is not covered by insurance policies. In addition, weathering and gradual deterioration as result of long term use and operation of the vessel are other important policy exclusions.
Weather Damage
Damage to motor and connections, electrical equipment and batteries caused by harsh weather conditions are excluded from Yacht Insurance policies. Damage or loss to such equipment is only entertained if the boat has been stranded, or been in collision or contact with another vessel, pier or jetty.
Damage or Loss of Personal Effects
Loss of personal effects is not compensated by insurance policies, unless a separate cover has been purchased. This also includes consumable stores, fishing gear or moorings.
Mechanical Damage or Failure
Yacht Insurance policies are not intended to cover non-accidental mechanical malfunctions or breakdowns.
Inland Transit Risks
Transportation of your vessel over land is not protected under boat insurance policy. Inland transport is potentially high risk and excluded from typical insurance covers.
Emergency Assistance and Towing
Emergency towing and assistance coverage as well as search and rescue are not included in typical Yacht Insurance policies. These are available as an additional cover and can be purchased separately.
Physical Damage
Damage to sheathing, sails, masts, spars or standing and running rigging are also not compensated unless the damage has been prompted by the vessel being stranded, sunk, burnt or has collided with an external substance. Sails and sheathing blown away by winds while set and outboard motor dropping or falling off board are also not eligible for a claim.
Modifications or Amendments to Original Design
Unapproved alterations in design and construction of a vessel are excluded from Yacht Insurance policies. Also, the expenditure incurred while remedying a fault in design or construction of the vessel are not reimbursed. This means that if damage occurs on your boat because of a manufacturing defect, you will not be covered by insurance to get it fixed.
Damage Due to War, Seizure or Nuclear Radiations
Damage caused by war, strike, confiscation or radioactive contamination are clearly excluded from Yacht Insurance policies.
Recklessness
To a large extent, negligence is covered by yacht insurance policies. Recklessness, however, is excluded. Recognizing yet deliberately ignoring risks to your vessel or any equipment therein is an act of recklessness. Taking out your vessel in unseaworthy conditions is one such example.