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Does My Home Insurance Policy Cover Boats?

Boating season is in full swing and Paris, Tennessee could not be happier about it! As you head onto the water this summer, it is important to know how and if you are protected. Below I will briefly explain the different coverage areas that a standard H03 homeowners insurance policy (also known as a special form homeowners insurance policy) entails. There is some coverage in the HO3 form policy for both damage to watercraft and liability for bodily injury or property damage to another party.


Damage to Watercraft

Damage to a watercraft is covered if caused by an insured peril but there is a sublimit of $1,500 for “watercraft of all types, including their trailers, furnishings, equipment and outboard engines or motors.” You are limited to $1,500 of coverage for owned and non-owned watercraft for damage caused by a covered peril, with limitations for windstorms, hail and theft causes of loss.


Bodily Injury

Although coverage is limited, there is some protection for watercraft liability on the HO3 homeowners form. The HO3 policy defines “watercraft liability” as liability arising out of the ownership, entrustment to others, or failure to supervise or negligent supervision of anyone by an insured involving the watercraft. It also means the maintenance, occupancy, operation, use, loading or unloading, or vicarious liability for a minor by anyone. The policy form excludes watercraft rented to others, used to carry persons or cargo for a charge, or if used for any business purpose. There is also a racing exclusion.

Coverage by type of watercraft

Liability arising from any watercraft in storage is covered if none of the above exclusions apply.

Owned or rented sailing vessels are covered if less than 26 feet long. If you do not own or rent the sailing vessel (you are operating a friend’s sailboat or are a passenger), it can be any length.

Owned inboard vessels are excluded, no exceptions. Rented inboard watercraft of 50hp or less are covered. Like sailboats, if you do not own or rent the inboard watercraft, there is no liability exclusion here. If you and a friend rent jet skis at the lake, you are covered under the HO3 form only if the jet skis are 50hp or less.

Any outboard motor-powered watercraft of 25 hp or less is covered, even if owned. Any non-owned watercraft (rented, borrowed, using, riding in, etc.) or any owned watercraft acquired during the policy period is covered regardless of horsepower. For owned watercraft acquired before the policy period, the vessel must be declared at inception of the policy.


In Summary

  • The watercraft liability exclusions in the HO3 policy apply mainly to certain owned and rented vessels.
  • Owned watercraft should be insured for both hull and liability coverage under a separate boatowners policy.
  • Boats should always be added to an existing personal umbrella policy.
  • While the liability exposure for the rental of a vessel other than inboard watercraft may be covered, there is limited coverage for damage to the rented watercraft.


Jon Dyer
Partner, The Wimberley Agency
Paris – Tennessee

*The information shared above is sourced from the Insurance Journal. The above coverage definitions reference the 2011 ISO HO 00 03 form. In the event of a claim or coverage questions, you always want to carefully read the exact form language in your individual policy.