According to the US Coast Guard, property damage resulting from boat collisions totaled a staggering $63 million in 2022. Some of these accidents will have unfortunately resulted in total loss. With its latest guide, Marine Insurance Now covers the criteria relating to total loss, helping boating owners make more informed decisions on which collision coverage is right for them.

For more details, please visit https://marineinsurancenow.com/collision-boat-insurance-what-you-need-to-know/

The new guide explains the term salvage value as the monetary value of a vessel after it has been damaged or declared a total loss. This determines how much an insurance company will pay out following an insurance claim. “Understanding the salvage value of your boat can help you make informed decisions about whether to repair or replace it after a collision,” the authors state.

The experts at Marine Insurance Now detail how insurance companies determine salvage value, listing age, condition and market value as considering factors alongside any damaged parts. Insurance companies will also consider any special features or upgrades that could increase the value of a vessel, even when damaged, the guide confirms.

If salvage value is low, a vessel may be declared a total loss, say the experts from Marine Insurance Now. When evaluating vessels for total loss, insurance companies will need to compare repair costs with the boat’s current market value. “If the cost of recovering and repairing your damaged boat exceeds its salvage value, then it is likely to be declared as a total loss,” the authors say. In the case of total loss, boat owners with collision insurance will receive a payout equal to the pre-accident market value of the boat.

The guide addresses common exclusions and limitations that often apply to boat collision insurance. Boat owners are reminded that intentional acts of damage are not covered under boat insurance policies, and therefore salvage value will not be determined in such cases. “This exclusion encourages responsible boating practices and discourages fraudulent claims,” the guide explains. “It’s essential to always operate your boat with care and avoid any deliberate actions that could lead to damages.”

Interested parties can find more information on the factors affecting collision insurance at https://marineinsurancenow.com/

Marine Insurance Now

60 W 23rd St
Suite 638

COMTEX_444504340/2824/2023-12-05T17:22:39