New Jersey Boat Insurance

To make an informed decision about boat insurance in New Jersey, we’ve highlighted some important information you should know, including cost factors, requirements, and other considerations.

While boat insurance is highly customizable and subject to optional add-ons and endorsements, there are generally two categories of boat insurance coverage in New Jersey: liability coverage and physical damage coverage. Both insurance types together can be considered comprehensive boat insurance. Let’s go over what they both mean.

Boater liability insurance covers the damages you may cause to others. If you cause an accident, your liability policy can cover the resulting medical expenses and property damage to the affected parties.

Liability insurance for boats often includes fuel spill coverage, too, which can pay to remedy damages that are caused by a fuel or oil spill after an accident. Liability coverage may also include wreckage removal, which can help cover the costs to raise or remove your boat if needed. Check with your provider on the specifics of these coverages in your policy.

Liability limits for boaters typically start around a couple hundred thousand dollars and may top out at $1 million. Be aware, though, that if you only have liability insurance, your insurance company won’t recoup you for any damages your boat suffers in an accident. Liability insurance only covers injuries and property damage to others.

To protect the value of your vessel, you’ll need insurance that covers physical damage to your boat. This can be achieved through a comprehensive boat insurance policy, which generally covers damage from vandalism, collisions, sinking, fires, and more. Your insurer will also reimburse you if your boat gets stolen.

For damage, comprehensive coverage usually protects your boat, including the motor, and any permanently attached equipment. Personal belongings, including fishing gear, aren’t usually covered by default. You can likely purchase additional personal property coverage for your boat policy at an added charge, though.

It’s important to know that you’ll need to pay a deductible when you file a claim for boat damage. Depending on the type of damage you suffer, your deductible may vary. For instance, your New Jersey boat insurance policy may have you pay a different deductible for wind damage than you do for a collision. Deductibles normally range from $250 to over $1,000.

When getting boat insurance in New Jersey, you’ll notice a few common aspects of coverage. They’ll have to do with winterizing your boat, navigational limits, and residence concerns.

New Jersey’s northeastern location means winters aren’t always friendly. Your boat insurer will expect you to properly care for your boat in the cold months by winterizing it. Wear and tear that could be attributed to your failure to properly prevent damage in the winter likely won’t be covered by your carrier.

Additionally, your policy may include expected layup dates. The absence of year-round boating in New Jersey keeps insurance rates relatively lower than in places with non-stop boating weather. And, you might find that the longer the layup dates in your policy are, the lower your rates are. 

In addition to weather concerns, some policies have navigational limits you need to consider. Your plan may not cover you if you take your boat a certain number of miles offshore, such as 75 or 125 miles. You should always be covered for inland boating in the many lakes and rivers around the state, though. 

A boat insurer may also ask if New Jersey is your primary residence. If you’re only in New Jersey seasonally, but you keep your boat there year-round, you may pay higher premiums depending on how it’s stored. Some boat insurance companies may not want you to leave your boat unattended for months at a time at your second home since there’s no one to prevent thefts or mitigate damage.

The state government doesn’t mandate boaters to get boat insurance in New Jersey, meaning there’s no law saying that you need to have it to legally operate your vessel. But, there are times when private businesses could require you to have a policy.

Many marinas and boatyards require customers to have liability policies on their vessels. This provides a safety net for the marina beyond the commercial liability policy that they have in place. Additionally, lenders require boat owners to have comprehensive insurance on financed boats. This way, if something happened to your vessel, your lender could recoup its value from the insurance policy.

As far as the law goes, there are certain age, licensing, and safety requirements you need to follow when boating in New Jersey. Violating these may affect your coverage if you were to get in an accident. For example, your carrier may not cover collision damages to your boat if it’s discovered you were driving under the influence at the time of the accident.

On the other hand, many boat insurance companies offer discounts for taking some state-sponsored boating safety courses. Providers believe that safer operators are less likely to file claims, so they’ll lower your premiums if you take efforts to be a responsible boater.

The cost of boat insurance is affected by many factors, but you may be able to get a policy for around $200 per year. But, the type of boat you have, the type of policy you have, and much more affect your premium. For instance, comprehensive coverage usually costs more than liability-only insurance. 

In addition to the ones we’ve already mentioned, here are some important factors that affect your New Jersey boat insurance rate:

Vessel age and size: Insurance policies on bigger boats generally cost more because bigger boats are usually more costly to repair or replace than smaller vessels. For example, a 50-foot sailboat is probably more expensive than a 20-foot flats boat. In addition, especially old vessels may cost more to insure, too, if they have valuable or hard-to-replace features.

Method of storage: The way you store your boat matters to insurance companies because it can reduce your risk of damage. Storing your boat inside when it’s not in use can reduce the chances of severe weather damage and theft. Insurance companies may ask you how you store your boat, and you may have lower premiums if you store yours in a way that reduces the chances of filing a claim.

Claims and accident history: Companies use as many factors as they can to assess a policyholder’s risk, and you’ll almost certainly pay more for boat insurance if you have a record of boat claims. Insurers believe someone who has filed boat claims in the recent past is more likely to file another.

Also, if you’ve been proven to be a dangerous boat driver, like by being arrested for operating under the influence, you’ll probably have higher rates. The same could be true if you’ve been proven to cause multiple boat accidents in the past.

ACV vs Agreed Value: One of the most direct factors that can influence your New Jersey boat insurance premium, though, is the way you cover your boat in your policy. Boat insurance plans are usually written with either agreed-value coverage or actual cash value coverage.

Agreed-value protection is what it sounds like. You and your insurer agree on a value to cover your boat, typically around its fair market value. Your boat will be covered in case of a total loss at this value for the life of the policy.

Actual cash value coverage factors in depreciation, which means you’ll receive smaller reimbursements the older your boat is. Agreed-value coverage doesn’t factor in depreciation. You’ll receive the same maximum payout for your watercraft no matter when you file a claim. In essence, actual cash value covers less, but it’s the more affordable option.

Optional Coverages and Add-ons: Depending on your carrier, you can add some coverages to your policy that may increase your premium. Some insurers offer packages like emergency towing, mechanical breakdown coverage, fishing equipment coverage, and uninsured boater coverage at an added cost.