Is boat insurance required when towing?
No, boat insurance generally is not required to tow a boat, as your auto liability policy covers damage to others while towing. However, if your boat is financed, your lender will require you to carry boat insurance. Some states require minimum liability coverage for boats while on the water, but towing on public roads doesn’t require a separate policy.
| Policy type | What it covers for boat towing | Limitation |
|---|---|---|
| Auto liability policy | Damage to others when towing | Does not cover damage to the boat or trailer |
| Boat insurance policy | Damage to the boat, trailer and liability for on-water incidents | Separate policy required |
| Homeowners insurance | Boat and trailer when stored at home | Limited to $1,500, not all boats qualify |
While boat insurance is not always required, there are situations where you may still need it.
| Situation | Boat insurance required? |
|---|---|
| Towing on public roads | No, auto liability covers damage to others |
| Boat is financed | Yes, lender requires it |
| Operating on water | Depends on state laws |
Does boat insurance cover the trailer?
Yes, most boat insurance policies extend coverage to the trailer used for towing the boat, covering it against damage, theft and breakdown both on the road and at launch sites. Your auto liability policy covers damage to others when towing, but does not cover damage to the trailer itself. For trailer damage coverage, a boat insurance policy is required.
"This is important protection to have because either the trailer or what you tow it with could have a breakdown," McChristian says.
She recommends talking to your insurance agent to find out exactly what your existing insurance covers - and what it doesn't.
Homeowners insurance typically covers boats, trailers and equipment such as motors up to $1,500, which is rarely sufficient to replace a boat or trailer. There are also restrictions on the types of boats covered. For any boat valued above $1,500, a separate boat insurance policy is the only way to ensure full coverage.
Boat insurance policies often include optional coverages beyond basic protection:
- Roadside assistance: Covers the towing vehicle and trailer for breakdowns, flat tires, running out of fuel and getting stuck
- On-water towing: Covers the cost of a tow if the boat breaks down on the water
- Uninsured boater coverage: Pays for your injuries and damage if you are hit by an uninsured boater
Audrey Sylvan, vice president of product management for Farmers Insurance, says anyone towing a trailer should review their policy "to ensure they understand what types of coverages they have, before rolling out onto the highway."
How can you save on boat and trailer insurance?
The most effective ways to save on boat and trailer insurance are to bundle your boat policy with your existing auto or homeowners insurance, maintain a clean claims history, take a certified boating safety course to qualify for a safety discount, and compare quotes from multiple carriers that specialize in boat insurance. Bundling with an existing policy qualifies you for a multi-policy discount, which can reduce your overall insurance costs.
Here are some of the most effective ways to reduce your boat insurance premium:
- Bundle your policies. Buy boat insurance from the same company as your auto or homeowners insurance to qualify for a multi-policy discount.
- Maintain a clean claims history. Boat owners with no recent claims usually pay lower insurance rates.
- Keep a good driving record. Accidents and traffic violations can increase your boat insurance premium.
- Take a boating safety course. Completing a certified boating safety course may qualify you for a discount.
- Compare quotes from multiple insurers. Boat insurance costs vary by company, so shopping around can help you find the best rate.
How much does boat and trailer insurance cost?
Boat and trailer insurance costs vary depending on the type of boat, how it’s used and the amount of coverage you choose. Smaller fishing boats and basic trailers are usually cheaper to insure, while larger wake boats, cruisers and boats used in coastal areas typically cost more.
Here are the biggest factors that affect boat trailer insurance cost:
- Boat type and value. Small fishing boats generally cost less to insure than pontoons, wake boats or cruisers.
- Coverage limits and deductible. Policies with higher liability limits and lower deductibles usually have higher premiums.
- Where the boat is stored and used. Coastal areas and hurricane-prone states often have higher insurance rates than inland areas.
- Driving and claims history. Boat owners with clean driving records and no recent claims typically pay lower premiums.
- Optional coverages. Add-ons such as roadside assistance, on-water towing and uninsured boater coverage increase the cost of coverage.
Comparing quotes from multiple boat insurance companies is one of the best ways to find affordable coverage for both your boat and trailer.
FAQ: Boat insurance and trailer coverage
Does boat insurance cover hurricane or storm damage?
Yes, boat insurance typically covers storm, hurricane, hail and wind damage with comprehensive coverage. However, some insurers apply separate hurricane deductibles or storage requirements during storm season.
Can you pause boat insurance during the winter?
Yes, many insurers offer a lay-up period discount for months when the boat is stored and not used. This can lower your premiumThe payment required for an insurance policy to remain in force. Auto insurance premiums are quoted for either 6-month or annual policy periods. during the offseason while still keeping some coverage in place for theft, fire or storage-related damage.
Does your credit score affect boat insurance rates?
Yes, insurance companies in many states use credit-based insurance scores when calculating premiums. Boat owners with higher credit scores often qualify for lower insurance rates.
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