Boat show season is well under way and this year will ring in as another strong year for new boat sales – that’s good news for insurance professionals writing boats.
The close of 2017 marked the sixth consecutive year of growth in new boat sales and recreational boating expenditures, according to the National Marine Manufacturers Association (NMMA). The association, which tracks marine vessel buying trends, expects the growth to continue through 2018, and possibly beyond.
Some of the new boat buying will come as a result of damages resulting from the 2017 hurricane season.
The Boat Owners Association of The United States (BoatUS), a national advocacy, services and safety group for recreational boaters, estimated that more than 63,000 recreational boats were damaged or destroyed as a result of both Hurricane Harvey and Hurricane Irma.
Hurricane Irma damaged or destroyed 50,000 vessels with approximately $500 million in recreational boat damage, while Hurricane Harvey inflicted a damage toll of $155 million on a toll on about 13,500 boats. These numbers neared that of 2012’s Hurricane Sandy, which remains the single-largest industry loss with more than 65,000 boats damaged and more than $650 million in estimated losses.
Todd Shasha, managing director of personal insurance, boat and yacht, at Travelers, expects to see a lot of new boats come into the market to replace the ones that were damaged in 2017.
In an environment where insureds are buying more boats, Shasha advises agents to keep an eye on new opportunities. “Really engage your customer, understand their needs and see if they have boat,” he said. “Try to pull all of your clients’ policies together and package them.”
Shasha also recommends being an advisor to insureds to help them avoid damage, too.
Based on boat insurance claims Travelers received from 2014 through 2017, collisions are the most common cause of loss, making up one-third of all claims. Wind and mechanical breakdown are the second and third most common causes of loss, respectively. The costliest types of claims are due to fires, boats sinking and lightning strikes.
“Perhaps the most reassuring takeaway from this data is that many of the top causes of damage are largely preventable,” Shasha said.
Travelers recommends taking these steps:
- Advise insureds to be familiar with a boat’s navigation and safety equipment.
- Advise insureds to navigate within marked channels to avoid running aground or hitting submerged objects near the shoreline.
- dvise insureds to stay alert when approaching objects such as mooring fields, navigational buoys and marine traps set in the water. Be aware that after a storm, high tides may have carried debris into the water.
- And if a storm is approaching, if at all possible, haul out the vessel and remove objects that could become airborne.
“No matter how many years of experience you have, it’s always good to brush up on the latest boating rules and technology to help you stay safe,” he said.
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