Yachts are perhaps one of the most valuable types of watercraft out there that individuals own. However, that value can span thousands of dollars to hundreds of thousands of dollars. When selecting yacht insurance, you’ll need to make a decision on how much you believe your yacht is worth, which ultimately determines how much you’ll pay for boat insurance. Your insurer can provide you with some guidance on how to do this, but there are various factors to keep in mind.
Choosing the Type of Value
There are various ways for yacht insurance plans to pay out to you should a total loss occur. Just like most types of property insurance plans, it is important to understand what happens when you file a claim for a total loss for your boat. You could receive payment based on current market value. If this is the case, your yacht’s value will be determined based on its condition at the time just before the loss. However, since boats can depreciate in value quickly and many factors play a role in their worth, this isn’t the most common way to determine value. Rather, an agreed upon value is selected. This means you and the insurer determine the value of the boat at the time of selecting the yacht insurance and that is the amount paid in the event of a total loss.
But, How Much Is It Worth?
There are various valuing tools available online. However, the best way to consider value is to think about a few things:
- How much do you owe on the boat? In most cases, you’ll want to make sure it is insured at least to that value.
- What does an appraisal of the boat say? For many yachts with custom features, this is a critical way to value the boat.
- What would it cost to replace your boat if it was lost today? Consider fair market value on boats like your own on the market today.
Over time, your yacht’s value will continue to change. You’ll need to update your yacht insurance to match that value as well. This can be done on a yearly basis when you renew your policy. Staying up to date on it is very important since that’s the only way to protect your investment and your finances.
Get a free quote today. Call Voyager Insurance Services at (800) 342-4444 for more information on Dallas yacht insurance.