How Much Watercraft Damage Coverage Is in a Homeowners Policy?

Homeowners policies can offer some coverage for watercraft damage, though it is often limited. This article explains the extent of watercraft coverage typically found within a standard homeowners policy. Homeowners policies generally provide only incidental protection for boats and other personal watercraft.

Homeowners Policy Watercraft Coverage

A standard homeowners insurance policy primarily protects your residence and personal belongings. While some policies extend minimal watercraft coverage, this protection is very restricted compared to dedicated marine insurance. The inherent risks associated with operating watercraft, such as collisions or sinking, are often beyond the scope of a general homeowners policy.

Coverage for watercraft within a homeowners policy serves as a supplemental benefit. It is not intended to provide comprehensive protection for significant investments. These policies reflect a focus on land-based risks, leaving many water-related exposures uninsured.

Qualifying Watercraft

Homeowners policies typically cover only small, less powerful watercraft. For instance, sailboats under 26 feet in length may qualify for some liability coverage. Motorboats with outboard engines of 25 horsepower or less are sometimes included.

Larger or more powerful vessels are almost always excluded from standard homeowners coverage. Owned inboard motorboats, regardless of horsepower, are frequently not covered. Personal watercraft, such as jet skis, are generally excluded from homeowners policies due to their design and typical usage.

Perils and Financial Limits

Physical damage coverage for watercraft under a homeowners policy is subject to very low financial limits. Many policies offer a maximum of $1,000 or $1,500 for damage to the watercraft, its motors, and trailers. This applies to specific perils such as fire, theft (while on the insured premises), explosion, or vandalism.

Liability coverage for watercraft is also severely restricted, with specific exclusions applying to watercraft incidents even if a homeowners policy provides overall liability limits of $100,000 or more. Perils like sinking, stranding, or collisions with other objects or vessels are typically not covered under the physical damage portion.

Where Coverage Applies

Homeowners watercraft coverage applies under very specific geographical and usage conditions. Physical damage coverage is often limited to incidents occurring while the watercraft is on the insured’s property, such as in a garage or driveway. Theft coverage may only apply if the watercraft is stolen from the residence premises.

Coverage generally does not extend to the watercraft while in use on the water, at a marina, or stored off-premises. Policies also exclude coverage for watercraft used for commercial purposes, rented to others, or involved in racing.

When Separate Watercraft Insurance is Needed

Given the limitations of homeowners policies, a separate, dedicated watercraft insurance policy is frequently necessary for adequate protection. Dedicated policies offer broader coverage for physical damage and liability, extending to scenarios that occur while the watercraft is in operation.

These specialized policies cover perils like sinking, collision, and liability for accidents on the water, which are typically excluded by homeowners insurance. They also offer higher coverage limits that better reflect the actual value of a watercraft. Relying solely on a homeowners policy for watercraft protection can leave owners exposed to substantial financial risks.