Test Your Boat Insurance Knowledge

What Do I Need to Know about Boat Insurance?

April 14, 2025

You’ve bought a boat and you want to get out on the water. What does your boat insurance cover?

Marine insurance protects you, your passengers, and your boat against unexpected events. Have you read your boat insurance policy thoroughly because there could be some exclusions in it.

Here’s what you need to know about boat insurance:

Does my driving record affect my boat insurance?

Do you have any accident claims or an impaired driving charge? A boat insurance client with a clean driving record is likely to attract less attention than someone with a spotty driving record with claims and accidents. Your boat insurance provider is likely to look at your driving record.

Does my house insurance cover my boat?

Your home insurance policy usually doesn’t have enough coverage to protect your boat. It may cover a rowboat or a canoe. Typically, the cost to replace or repair your boat will be greater than the amount covered by your homeowner’s policy.

Note that if your boat is worth less than $3,000, is less than 26 feet (eight metres), and its horsepower is less than 50 HP., it’s likely to be covered under your home insurance policy.

What about the personal liability coverage on my home insurance policy? Your personal liability coverage on your home insurance covers you if people are injured or their property is damaged at your house or on your property. You would need to check with your insurance provider to find out whether your personal liability coverage on your home insurance would cover a boating accident. It may depend on the size of your boat. If you insure your boat, $3 million in liability insurance is usually required if you are docking at marinas or if your boat is financed.

Extra marine insurance coverage is needed for boating outside Canada

Boat insurance policies include details about the areas where you take your boat.

This depends on your insurance provider and can include distances from the shore or, in some cases, outline longitude and latitude limits.

If you boat outside your policy’s navigational limits, you are usually excluded from insurance coverage.

If you want to head south, for example, expect that you will need to extend your insurance coverage.

Ask about cross-border coverage for your boat.

Actual cash coverage covers the cost of a new boat

Actual cash coverage covers you for the value of your boat at the time of loss, less depreciation.

An agreed value policy honours the value of your boat at the time the policy was written but it usually has a time limit. For example, a boat might have agreed value coverage until it is 15 years old.

My boat insurance will cover any parts that need to be repaired

Your boat insurance policy may exclude damage caused by failing to maintain your boat properly. A basic boat insurance policy does not cover any machinery or parts that need repair or replacement due to lack of maintenance, improper use, mechanical and production defects, or because they are old.

It’s essential to keep up with routine maintenance tasks and have your boat inspected regularly.