Boat rental insurance – cost and types of policies

Whenever you budget the expenses of your business, Boat rental insurance must be included in the list because you can’t always know exactly what could happen in the future.

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With the protection provided by liability insurance and all the other sorts of insurance we will tell you about, you can protect your business and yourself in case something unexpected happens.

Like any business owner, for your Boat rental enterprise, you must consider how much financial risk you are taking on.

If your Boat rental business runs without proper insurance, you are taking a giant chance not just of losing some money but of a final wipe-out.

This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the upshots of their actions. 

Boat rental  Insurance

In this article, we are giving very general guidelines for small businesses to explain what the main kinds of insurance that you need are, and where we can, a rough guide to how much you can expect to pay.

The question is, can you afford to NOT have insurance for your Boat rental business?

What this means, for any Boat rental business owner, is that if some person claims that your business caused them some physical or economic damage, a court can award damages far beyond the total size of your business.

Your Boat rental business is not sheltered by laws in the same way as states are, where laws can place a “cap” on the maximum level of liability.

In some states, like New Jersey, there are specific monetary levels that limit the amount a judge can award in any case against the state.

In a court case, it’s purely the right of the jury to award whatever amount they deem appropriate, even sometimes giving a plaintiff more than they have claimed.

When you are running your Boat rental operations, you can’t escape responsibility for the consequences of your actions.

Even more importantly, unless you have spent beforehand the money necessary to have your business running as a limited liability company, all of that liability belongs to you as a person.

What does Boat rental insurance protect you from?

For your Boat rental business, the most important kinds of insurance are intended to cover the risks to your business from accidents, from unexpected events, and from mistakes.

In addition there are some legal kinds of insurance that various states require.

In the next few paragraphs, we will describe the most important points any Boat rental business owner should remember when negotiating the insurance needed.

The main headings of insurance for your Boat rental businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.

Liability insurance

General liability insurance

Any Boat rental business is dealing directly with customers, and that means you always have the danger that some accident can happen to them personally or else something of theirs can be damaged.

In such a case, they can demand compensation.

General liability insurance policy for your Boat rental business insures you against claims coming from injury to customers or damage to their property.

It protects your Boat rental business from the claims themselves and also to any associated court costs and legal fees of the lawsuits.

In many cases, it can also help you to qualify for extra business from city and state organizations, where contracts demand proper liability insurance.

The normal level of general liability insurance for your Boat rental business would be with a upper limit of $1 million for a single claim and a total of $2 million for the whole year.

See the table in the costing section below for average prices of general liability insurance for your Boat rental insurance operations.

Professional liability insurance for your Boat rental business

In the event where a client alleges some negligence, errors, or omissions in how you conducted your Boat rental business for them, you can quickly have to fight a court case.

Even if the lawsuit against you is decided in your favor, the cost of defense can be large, and the impact on your reputation can be damaging.

Almost all small Boat rental business should have enough professional liability insurance to cover an individual claim of $25,000, with annual cover of $50,000.

See the table in the cost of Boat rental insurance section below for average prices of professional liability insurance for your Boat rental operations.

Product liability insurance

Whatever goods you sell or advice you give about the goods, you are running a risk that buyers may claim that what you delivered didn’t meet your description of function, or that your recommendation was basically incorrect.

You need to be aware of the particular laws of product liability in your own state.

For example, in California, all businesses in the supply chain can be held responsible for results caused by products claimed to be defective.

To cover yourself against any possible lawsuit, you need Product liability insurance for Boat rental

Only you can know exactly how much insurance you need.

Best advice is to consult with experienced insurance agents, brokers or company representatives for help.

Commercial insurance

Commercial vehicle insurance for your Boat rental business

Take care! – practically all policies for private vehicle insurance do not cover any happening like theft or accidental damage when the car is being used for business purposes.

The proper way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a designated commercial vehicle insurance package.

Commercial car policies cover the value of any vehicle in case of accident, malicious damage, fire, or theft.

Also, in case of any accident, the car itself, the content and any legal bills, medical expenses, and property damage is covered if your car is involved in a crash.

Most states, other than Virginia and New Hampshire, require this type of insurance.

The necessary value of the insurance is worked-out for the depreciated value of the vehicle, and your declared level of cover of contents. 

Tools and Equipment insurance

Since your Boat rental business needs specialized and costly equipment, you know how much it can cost to replace it in case of any damage, loss, or theft.

The equipment may be subject to malicious damage, deliberate fire, theft, other such unexpected acts.

As well, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can wipe-out your whole business in one stroke.

Unless you can afford to immediately replace such unique gear quickly out of your own pocket, you should have full-level equipment insurance so that you can immediately buy whatever needed to keep your Boat rental business running.

It is difficult to advise how much equipment insurance you need – it’s really dependent on how much you have invested in your Boat rental business’ equipment.

Commercial Property insurance

Any Boat rental business that owns or rents space in a building should have a commercial property insurance policy.

If you own the space, you probably have a substantial capital investment, in addition to a big liability if there’s a mortgage.

Any physical building location needs to carry insurance coverage for the value of the premises and contents against accidental occurrences like fire and storms, and against deliberate damages like theft and vandalism.

If your Boat rental business operates in areas of high risk, like California or North Carolina, extra coverage may be needed for earthquakes and hurricanes or tornadoes.

In other states like Rhode Island, where unlimited cold snaps can cause damage to outer coverings of Boat rental business premises, there is a need for more extra cover than in warmer climes.

Because the level of cover depends entirely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of Boat rental insurance section below to give some idea of the average prices per million dollars of property insurance for your Boat rental business.

Temporary insurance by month, week or day for your Boat rental business

Is your Boat rental business working part-time or casually, or is the level of business seasonal?

Using short-term insurance makes good sense. Business insurance by the month, day, or week – temporary insurance for Boat rental – are special policies where you can cover a nominated period when you want to be covered.

By only paying for that period of cover, you will save by having reduced premiums but still having adequate risk cover.

The essential feature of short-term insurance is that you buy the cover for a defined period – a nominated date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.

When you are expecting periods of better business activity, get the existing cover increased.

Talk to your insurance agent, broker or the company’s representatives to see what options you have.

Business Owners Policy BOP for your Boat rental business

You have the option to combine several of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.

A BOP combines commercial property and public liability insurance by amalgamating these coverages into one insurance policy, which can save you money.

BOP insurance will protect you if any claims of injury or property damage are made.

It is frequently the right choice for small and medium-sized Boat rental businesses, such as yours.

There are a few limits that will dictate whether BOP is suitable for your own business.

BOPs cannot cover your professional liability or commercial vehicle policies.

Also, the size of your business will dictate whether you are eligible to take out BOP cover.

The usual business that is eligible for a BOP policy must have no more than one hundred employees, and under five million dollars in annual revenue.

As well, you must separately take out the necessary worker’s compensation, health and disability insurance as determined for your state.

Workers Compensation insurance for your Boat rental business employees

In almost all states, it is mandatory to have workers compensation insurance when your Boat rental business has one or more employees.

Workers compensation insurance covers the business against any costs that arise if a worker experiences an injury or becomes sick as a result of work.

The benefits cover medical expenses, death benefits, lost wages, and vocational rehabilitation.

Failure to meet a state’s requirements in this regard can leave you as the employer required to pay penalties levied by the states.

Some states, such as North Dakota, Ohio, Washington, West Virginia, and Wyoming only permit coverage from the government-run monopoly state funds.

In these states, you cannot obtain your workers compensation obligations from private insurance corporations.

Workers compensation rates are worked out based on the employee’s pay, and usually come out at around $1.00 per $100 per month.

However, you must see the relevant authorities in your state.

Average costs of these types of insurance

Although every Boat rental insurance need is unique, there are enough examples of standard quotes from insurance companies for us to give appropriate guidelines, including what are the cheapest rates offered.

Of course, you should always check with an agent what’s relevant for your business.

The list below is of annual premiums we have collected for the main types of insurance your Boat rental businesses needs.

Types of insurance Price range
Public liability insurance $332 – $611
Product liability insurance $296 – $765
Commercial insurance $1128 – $2905
General liability insurance $713 – $909
Commercial vehicle insurance $1550 – $2756
Equipment insurance $467 – $1014

Cost of insurance for your Boat rental operations depends on many different factors.

We have calculated these figures for small independent Boat rental businesses.

In larger states like Texas, premiums are generally about 20%-30% higher than national averages, whereas in smaller states like Oregon, they can be about 20%-30% lower.

The location and size and type of your Boat rental business can have a big effect on the cost of different policies.

You should consult with professional insurance agents and brokers, or insurance company representatives.

In addition you can let the internet do the work for you by enquiring about insurance companies near where your business is located.

Another reliable source of information is the local Better Business Bureau in your town.

FAQ

What is small business insurance for Boat rental operations?

This is an umbrella term used to describe basic insurance policies designed to protect Boat rental business owners from risks like bodily injury, property damage, claims of negligence.

Does my Boat rental business have to have insurance?

Some of the types of insurance are not mandatory for you to open your business, but they can protect you from risks in your business operations.

Some other forms are required by state law, such as workers compensation and vehicle insurance.

What does a small Boat rental business insurance policy cover?

Liability insurance provides insurance against lawsuits or claims filed by a third-party for bodily injury, property damage, or negligence.

The exact cover will vary based on your own operations.

See the table in the costing section above for average prices of the most common policies for Boat rental insurance.

How much will Boat rental business insurance cost?

On top of the size of the business, several other factors, such as location and claims history, are used to determine your policy’s cost.

You should talk to professional insurance agents and brokers, or insurance company representatives.

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