Do You Need Boat Insurance When Renting Boat

Marine Rental Insurance

So a big question that comes up a lot for both the boat owner and the boat renter is Do you need boat insurance when renting out boat? 

We'll answer this question in the context of two different parts, one as a boat owner and two as a boat renter. The simple answer is that in some states, you are required to have boat rental insurance while in others, it is a bit more relaxed.

There is no way to sugarcoat it, insurance is a boring topic and can get complicated but it doesn't have to be. It is strongly recommended that you have boat insurance to stay protected. Let's look at this from different points of view.

Simply choose from above to get more tailored information.

Boat Rental Insurance As A Boat Owner

If you are a boat owner that plans to rent out your boat to other people, it is strongly advised you have the right insurance.

While not a regulatory requirement in some states or countries, not being insured for renting means you are extremely exposed.

There is no need to complicate this and worry as there are a number of options available to you. And you can simply charge the renter for the insurance cost.

If you plan on regularly renting out your boat, it's best to avail of something like peer to peer boat rental insurance.

Every policy will be different but this will ensure you are covered in the event of your vessel being damaged or the renter being injured.

So as a boat owner, what are your options? 

1. Peer To Peer Boat Rental Sites

boat insurance for renting
The image is cost to rent boat with geico coverage provided (not insurance cost only)

There are some boat rental sites where you can list your boat and avail of peer to peer rental insurance.

This means that you list your boat for rent and when a potential renter books your boat, they will be charged a fee for insurance.

This is a simple and straightforward way to insure your boat with relative ease.

One site that allows this option for boat owners is Boatsetter.com

Simply put, it's like Airbnb but for boat rentals. You list your boat for rent, they take a percentage of the rental fees and they also provide an option to avail of their peer to peer insurance provider.

As a boat owner, you should also be aware that a peer to peer policy versus a recreational insurance policy are completely different.

Most recreational policies will NOT cover you for rentals so please keep this in mind. Also, the way your boat is valued for damages is very different with peer to peer insurance policies versus a traditional recreational policy.

2. Contacting Boat Insurance Provider Directly

Another option for boat owners is to simply contact boat insurance companies directly and work out a price. If you would prefer to advertise and rent out your boat on your own without listing it on a peer to peer rental platform, this is an option for you.

You can look at policies like Boatus Peer To Peer Boat Rental Insurance and get a quote and more details from them. Alternatively, you can simply contact boat insurance providers directly and see will the provide such a policy for you.

Some of the most popular boat insurance providers are Boatus (as mentioned above), Progressive, Allstate, State Farm, Nationwide etc.

As a boat owner, these are your two best options for rental insurance. The cost of the policy will vary from boat to boat and location so please keep that in mind too! 

What Boat Owners Should Consider

As a simple checklist of sorts, these are the things a boat owner should consider before EVER offering your boat to rent.

Does my current boat insurance policy cover rentals?

In 99% of the cases, your recreational policy does NOT cover offering your boat to rent. Simply contact your provider directly for clarification on this.

If you have difficulty getting the proper insurance through your policy provider, a fast and simple solution is to list your boat on sites like Boatsetter where you will be given the option to have the appropriate insurance.

Is my boat safe and meet the required regulatory safety standards?

Any boat used on the water should meet the safety requirements of state regulatory bodies. You must have the required safety equipment and ensure your boat is in the right working order.

Failure to do so will make your insurance policy void and you will not be covered in the event of an accident or damage.

What does a boat rental insurance policy cover?

marine insurance policy coverage

Boat owners should also be clear on what exactly the coverage protects against. Each policy is different but talking with insurance providers will provide specific insights on this.

You'll want the standard protections like: 

These are some of the basic an extremely important things you'll want included in any policy as a boat owner. If the worst was to happen and someone was injured onboard, it means you'll be safe and protected.

You'll also want to known how much liability you will be covered for in the event of a total loss of your vessel. Boatus for example will provide protection up to $300,000. (this can change at any notice so contact them directly)

Is the person renting the boat above the age threshold and have relevant boat experience?

You as the boat owner will want to ensure that the renter is above the age threshold to ensure that the rental policy is valid and not void.

You can ask for a boater education card or proof of age before allowing them to use your vessel.

Tips For Reducing Liability As A Boat Owner

There are a number of things you can do as a boat owner to reduce your liability when renting out the boat. Some of these include:

Bonus tip would be to offer them the option to take free safety courses to ensure they are brushed up on boat safety skills.

You may also like to check out our how to rent out your boat article for more specifics on making money from your boat.

Boat Rental Insurance As A Boat Renter

Heading out onto the water with friends or family is obviously a lot of fun. But are you covered in the event of an accident or damage? 

There have been some bad stories of people taking boats out to rent and sinking them and being landed with a big bill as a result.

For peace of mind there are a number of options available to ensure you are protected when renting out the boat.

1. Renting From Peer To Peer Boat Rental Sites

boat charter sites

On sites like Boatsetter, you'll be charged a bit extra for marine rental insurance which should cover you in the event of an accident.

You'll also have to give a safety deposit which the boat owner can keep in the event of you damaging the boat.

There are a number of other protections when you rent through an online platform (however, it should be noted that not all rental platforms are equal when it comes to insurance coverage), examples being:

These are some basic protections but the onus is on you to ask a boat owner exactly what is covered and ideally have this in writing.

Again, booking through a peer to peer site should automatically have you protected (depending on platform)

2.Renting Directly From Boat Owner

There are some sites where you can reach out directly with a boat owner and charter their boat. You should be extremely cautious in scenarios like this as you could end up with no insurance coverage at all! 

Sites like Craigslist can be the wild wild west and isn't advisable in most cases.

But if you still would prefer going down this route, make sure to ask the boat owner exactly what is coverage and what you as the renter are liable for.

With so many safer options to rent a boat and be protected, this should be a last resort.

What Boat Renters Should Consider

As someone looking to rent a boat, here are some simple things to consider before renting out a vessel.

Where Can I Go?

When you plan to take out a boat, you should ask the owner are there any restrictions on where you can travel. If renting in the United States for example, the majority of boat owners will only allow you to travel on American waters.

There may also be restrictions on how far off the coast you can travel but this can easily be cleared up by simply asking the boat owner directly.

Usually the restrictions are to keep within 12 miles of the coast but this can vary.

What happens If I Damage The Boat?

This is another important question to ask the boat owner. Will the insurance company cover any damages to the boat or are you liable as the renter?

It's important to be clear on this before heading out on the boat.

Does The Boat Owners Insurance Policy Cover Renters?

Seems obvious but it's really important to ensure the boat owner has the correct insurance policy to keep you as the renter protected.

It's also best to get this in writing too (either through email or through an online platform like Boatsetter)

Are There Any Scenarios Where I Might Not Be Covered? 

As a renter, you should be crystal clear on how you might not be covered so as to avoid scenarios like that. The boat owner will provide you with the specifics of this and if they don't, you can simply move onto another boat to rent.

What Exactly Is Covered In The Rental Insurance Policy?

You as the renter will want specifics on what exactly you are protected against. This will help add peace of mind and keep things clear.

Some policies might only cover 5 people when you have 6 for example so it's crucial to understand in detail what exactly is covered.

Tips For Reducing Risks As Boat Renter

A simple solution to all of this is to hire a boat captain with the boat you rent. This means you don't have to worry about meeting some standards to actually be able to charter the boat.

Most peer to peer platforms provide options to add a captain for a fee and if you have no experience with boating, this is something to consider for sure.

Other things you can do to reduce risk is: 

These are just some of the ideas to help reduce your risk and have a great day on the waters.

So there you have it...

The above information are simple tips to ensure both the boat owner and boat renter are protected in the event of an accident occurring.

Staying protected and compliant with all regulatory bodies is very important. Again, as a reminder, if in doubt, simply contact your insurance provider if you are a boat owner or ask the boat owner directly if you are a boat renter.

And keep everything in writing, either through email or through online platforms to help avoid any confusion either boat owner or renter may have.

And most importantly have a great time on the water!