Owners and operators of boat dealerships are exposed to a variety of unique risks that must be covered with comprehensive boat dealer insurance or commercial marine insurance.
You need coverage for your inventory as well as liability protection for the numerous ways in which you or your employees may cause bodily injury or property damage in the course of doing business.
You need to work with an experienced boat dealer insurance agent who can help you find the right mix of insurance products that cover your specific needs.
Risks Unique to Boat Dealers
Any business that sells new or used boats or regularly rents, trades or repairs watercraft can be considered a boat dealer. Here are just some of the property and liability risks that boat dealers face:
- Inventory damage while on a lot or in a marina
- Boat damage during seaworthiness tests
- Bodily injury or property damage during seaworthiness tests
- Damage to boats during transport on trailers
- Building and contents damage due to catastrophic events
- Business interruption
- Truth in lending and title claims
Property and Liability Concerns for Boat Dealers
Like most businesses, boat dealers likely have buildings and contents that need to be protected with insurance. In addition, you face property risks associated with your boat inventory and your interaction with the general public.
Property damage to your inventory can occur in any number of ways, from windstorms and hail to vandalism and customers taking boats out on the water.
Boat dealers also face a variety of unique liability risks associated with the following activities that take place at their business and with their product:
- Seaworthiness tests: Customers who take boats out on the water pose a great threat to themselves as well as other people and watercraft. If a customer causes property damage, injury or death while operating one of your boats, you can be held responsible.
- Faulty repairs: If you take customer-owned boats into your possession in order to perform repairs or maintenance, you can be held liable for damage to those boats or for faulty repairs that cause injury or death.
- Catastrophic events: Fire, smoke or other catastrophic events can damage customer boats in your possession. You could be held liable for damage to other people’s property that is in your care.
- Product liability: A faulty part in a boat that you sell can cause property damage or can injure someone. You could be held liable in these cases.
Boat Dealer Insurance Coverage Overview
Boat dealers seeking appropriate business insurance coverage must work with a knowledgeable agent who specializes in their line of work. The right agent can find individual and packaged boat dealer insurance policies that will address the various forms of property and liability risks you face.
The following are some basic business insurance policies boat dealers generally need, in addition to specialty policies and endorsements tailored to boat dealers.
- Commercial general liability (CGL) insurance provides broad coverage for bodily injury and property damage caused by you or your employees. CGL insurance also covers claims related to slander, libel and advertising liability.
- Commercial property insurance provides protection for your business property, including building(s) and contents.
- Business income coverage provides coverage for lost income and expenses if you must temporarily cease operations after a catastrophic event. It pays employee salaries, rent and other expenses while you are closed to make repairs.
You may also need the following types of coverage and others depending on your needs and the specifics of your business. Many of these policies can be purchased as endorsements to your basic liability or property policies, or they can be packaged into a comprehensive commercial marine policy.
- Title errors and omissions coverage: provides protection for boat dealers who make an error in title-related paperwork
- False pretenses coverage: protects your business if you are unwittingly coerced to release a boat to someone under false pretenses
- Employee dishonesty coverage: covers costs associated with employee theft and crime
- Truth in lending coverage: protects boat dealers who fail to comply with the Truth in Lending provisions of the Consumer Credit Protection Act
- Engine hours errors and omissions coverage: protects boat dealers from legal claims specifically related to a boat’s engine
- Coverage for customer boats in your care
- Workers’ compensation: protects employees who are injured on the job
- Product liability coverage: for losses or injuries to a user, buyer or bystander caused by a defect or malfunction of a boat
- Commercial automobile coverage: protects vehicles that your business owns as well as trailers that you use to transport boats
- Marina insurance: protects boat dealers that also operate as a marina for damage caused by boats owned or operated by the marina and for damage to boats docked at the marina
Find a Knowledgeable Agent for Comprehensive Boat Dealer Insurance
In order to find the best coverage for your business, it is equally important to find the right insurance agent. Boat dealers should seek insurance agents who have experience in their business and who have worked with insurance companies that specialize in commercial marine coverage.
Together with your agent, you can assess your specific business risk and find the right mix of property, liability and specialty coverage to protect your assets from lawsuits and claims. Contact an Independent Insurance Agent today.