Best insurance options for recreational vehicles
The one with the most toys - boats, motorcycles and personal watercraft - is probably having a lot of fun with them. But that person is also probably coughing up quite a bit in insurance premiums each year to protect them.
The fast, high-performance Kawasaki Ninja that Don Rousell’s son drives probably wouldn’t cause much damage to a larger vehicle if it collided with it, but the chance of bodily injury to Rousell’s son is greater than that of someone driving a car or a larger, slower motorcycle. Rousell, New Orleans area manager for ABC Insurance Agencies, says his son’s policy is much more expensive than one for an older driver of a slower, heavier motorcycle.
A number of factors determine the motorcycle premiums, including the driver’s gender, age, experience, whether the driver holds safety certificates, where the driver lives and whether the bike will be kept in a garage, says Rousell.
Louisiana law requires that an owner buy at least liability insurance on motorcycles. State law does not require insurance on all- terrain vehicles like four-wheelers, personal water craft like Jet Skis, small fishing boats and off-road motorbikes. But insurance agents say insurance on such items is very reasonable, so people with the means to own such items often purchase insurance.
When mandatory auto insurance went into effect a few years ago, many motorcycle riders bought the minimum liability insurance required, but those who own flashy or valuable toys like the Ninja choose to go with a more comprehensive coverage, says agents.
Despite the physical dangers associated with motorcycle riding, exacerbated recently by Louisiana’s helmet optional law, Rousell says motorcycle insurance is usually more reasonable than car or truck insurance. That’s because the cost to repair or replace a motorcycle - even a high-performance Japanese bike or top-of-the-line Harley- Davidson - is less than what it would take to repair or replace, say, a late-model Lexus sedan.
Still, Kevin J. Daley, an agent with Beneficial Insurance Mid City Inc., says he’s seen yearly premiums in the $3,000 range for a young driver with a comprehensive policy on a high-performance bike.
Through companies like Progressive Insurance Co., Daley also writes policies for small boats. He says most boat owners purchase policies with low limits of liability to cover replacement of the boat and the cost of any physical injuries. Once someone plunks down anywhere from $2,000 to $15,000 for a boat, chances are he’s going to want it protected, says Daley. One customer, he says, has a bass boat with an engine that’s worth in excess of $7,000. It may not be like an Al Copeland boat, like $30,000 to $40,000, but for a young kid that’s a lot of money. They want to make sure it’s protected.
He stresses there’s a wide range of variables that determine yearly premiums, but for an 18-foot, fiberglass fishing boat valued at $10,000 with collision, liability, and an uninsured boaters coverage, the yearly premium would be $1,066. And that’s on a relatively expensive boat, he says. Of course companies are leery if (the boat) has been modified and is extremely high performance. They’ll want to limit their exposure on boats like that.
But though the person will pay more, they will probably be able to get a policy. One factor that weighs into the decision is automobile driving records, which insurers feel is an indication of risk.
We think there’s a correlation between a bad driving record and a potentially bad risk on the water, says Howard Reiff, a spokesman for New York-based Ski-Safe, a niche company that specializes in recreational marine insurance. Ski-Safe, which writes policies in Louisiana, insures personal water craft, ski boats, yachts and antique boats.
Reiff says the riskiest proposition when it comes to water vehicles are personal water craft, and that’s why the company is particularly selective when issuing these policies. The problem is that many people let inexperienced drivers - often children - operate the vehicles. When kids are using these personal watercrafts jumping wakes and waves, unfortunately there are a lot of injuries, Reiff says.
Besides the injury risk, personal water craft also are easily stolen, Reiff says. Besides being particular about who it writes policies for, Ski-Safe advises policyholders about proper storage of the watercraft, like keeping it garaged as opposed to in front of their homes.
When writing a policy, the company also takes into account the number of months people will be using the watercraft; for example, premiums will be less for those who uses the vehicles only part of the year. Ski-Safe also looks at where the vehicles will be used, with open seas warranting higher premiums than calmer, inland lakes.
Most people, says Reiff, buy insurance that provides $10,000 to $25,000 in liability coverage on their personal watercraft. Such yearly premiums would range from $174 to $250 per watercraft, he says. Ski-safe does not offer multi-unit discounts.
In response to demand from its primarily upscale clientele, Novato, Calif.-based Fireman’s Fund Insurance Co. added its Aquamarine division last spring. The company expects the products to be available in Louisiana this summer. The products offer coverage for all boats and personal water craft, with the exception of yachts with paid crews and racing boats.
The boat enthusiast of the Aristotle Onassis variety might want to turn to Warren, N.J.-based Chubb Group of Insurance Cos. to insure a yacht. One of the company’s specialties is writing policies for so- called megayachts, says Chubb spokeswoman Mary Ann Avnet. These boats are generally defined as those valued in excess of $1 million and include a paid captain and crew.