Cover up for the Saturday sale
You’ve got a buyer lined up for your current boat and you’re finalising your thoughts on which of the extended new year boat specials is right for you.
Bewdy, it’s going to be a fantastic 2018. But before your current boat heads out your driveway in the hands of its new owner and before you sign on the dotted line for your new rig, you need to be very clear about where your current insurance policy stands – or perhaps, even falls over. If you are insured with a leading specialist marine insurer such as Nautilus Marine Insurance, things are already a long way down the track to panning out perfectly.
For example, your current insurance policy ordinarily will give you 21 days’ automatic coverage for your new boat. And here’s a major win for you – the value of your new boat is not a problem in this regard. Time to break it down a little. Let’s assume your current boat, which your neighbour Tony is keen to buy, is worth $23,000 and is insured for that value. Let’s also assume the boat, motor, trailer and electronics package you intend to buy on Saturday from your local marine dealer is worth $85,000.
Nautilus Marine will give you 21 days to update the details of your new boat and in the meantime, provide coverage for it at the new boat price of $85,000. So it doesn’t matter if your insurance broker or other businesses are closed on the Saturday afternoon, you can still proceed with the purchase knowing you have three weeks in which to sort things out. However, be aware that some insurers do not offer this temporary cover for the new, higher-value boat – they will only cover you for the $23,000 proportion of your $85,000 boat.
OK, so what about Tony and your ex-boat? Basically, that’s an issue for Tony. He needs to arrange his own insurance cover, perhaps by going online to take out cover on the $23,000 boat he bought from you. Even better, he should phone Nautilus Marine before finalising the purchase of your boat, satisfy himself about the terms of cover and his eligibility to secure insurance cover in his own right and get the paperwork under way.
Bottom line: your policy will not cover both boats simultaneously.
The key point to understand is while the policy coverage might automatically transfer from boat to boat, it does not automatically transfer from owner to owner. While you own the boat and your insurance policy is in place, you are covered. Once someone else such as Tony takes ownership, there is no longer coverage of that boat until the new owner organises it. You, as the former owner, do have an insurance credit sitting for the unused proportion of your annual insurance fee. It is that credit that is used to provide coverage for your new $85,000 boat in the interim.
If you are selling your boat and not buying another, you can ask your insurer for a refund on the unused proportion of your policy. Say it’s February now and your policy would have been due for renewal in July, you would have a credit of four months’ insurance. Finally, as with all insurance policies, always check your product disclosure document and if you have a query, ask for clarification.
If you need further information, you can contact Nautilus Marine Insurance on 1300 780 533 for any boat insurance requirements.
Win a Nautilus Marine rod
Nautilus will also be answering your boat insurance questions of a general nature and offering a great bi-monthly prize for the best questions received. The prize is a custom-built 15-24kg Nautilus Marine-branded overhead 5’6” light game and reef fishing rod crafted by Gary Howard and featuring Fuji guides, a graphite reel seat and roller tip. Each rod has a retail value of about $300. Just email your questions to qld@nautilusinsurance.com.au
