Insurance companies prejudice towards liveaboards

[Mac2]

Looking into finding a reduced rate for insurance after my recent survey and discovered a large number of insurance companies won't even insure liveaboards. I find this perplexing. I would think a liveaboard would get a discount rather than penalized. After all, being on scene to discover an emerging problem, seems like a good thing. Plus the fact I have saved insurance companies multiple thousands of dollars for the sinking boats I have called in along with thieves breaking into boats, diesel spills, and on and on. Can anyone explain this? Is there a movement to educate underwriters?

 

[Delta Riverat]

Yeah, kinda funny eh? Insurance companies don't want to insure vacant houses for sure. No one to catch water leaks, vandalism and theft, but frown on living on a boat? Disconnect for sure.

I love the fact that I have liveaboards on both sides of me.

 

[psneeld]

What you are not getting is many liveaboards are not TFers with some care and knowledge of boats...but a great many of them are dreamers with no clue at all.

Live amongst them like I have...not the loopers and not the well off snowbirders or world cruisers, but the down on their luck liveaboards who decided the Jimmy Buffet dream is doable on a whim and a bit of cash.... experience and knowledge not a prerequisite.

Some insurance companies don't seem to put much faith in the human element that has tons of exceptional boating experience and cares for their boat like a child and has NEVER had a claim in 50 years of boating, yet a few insurance companies do..... but you are still gonna pay a higher premium because shi* happens when using a boat 24X7X365.

 

[Mac2]

I get some people don’t take care of their boats. I would think that would be more reason to have a livaboard to detect the inevitable problem. I get what you’re saying if these boats actually leave the dock but I remember a boating article that did a study showing more boats sank at the dock then at sea-an argument in favor of a livaboard.

 

[PierreR]

Do you also have a dirt home? If so, you are not a liveaboard,

 

[psneeld]

I get some people don’t take care of their boats. I would think that would be more reason to have a livaboard to detect the inevitable problem. I get what you’re saying if these boats actually leave the dock but I remember a boating article that did a study showing more boats sank at the dock then at sea-an argument in favor of a livaboard.

I think you are missing the point that many liveaboards don't leave the dock and are clueless and thus are a major headache to insurance companies. Yes.... a select few of us liveaboards are responsible and save them thousands or more dollars but we are the outliers, not the major liability.

 

[psneeld]

Do you also have a dirt home? If so, you are not a liveaboard,

You are to an insurance company if you spend more than a certain number of days aboard. That is also true of many marinas. It doesn't have to be 365 days either.

The house isn't even part of the equation unless the insurance company is considering that in your "risk factor" that you have additional liability insurance and assets that can be attached if need be.

That is all what I have been told by insurance companies, brokers and adjusters through the years...but I am not an expert in the field.

 

[Mac2]

I think you are missing the point that many liveaboards don't leave the dock and are clueless and thus are a major headache to insurance companies. Yes.... a select few of us liveaboards are responsible and save them thousands or more dollars but we are the outliers, not the major liability.

Im trying to figure out why a insurance company differentiates between living aboard vs not living aboard weather your clueless or not. I would think the clueless part would make more of a difference i.e headache for the insurance company. When you consider I have to pay a livaboard fee for each person on my boat, it starts to get real aggravating.

 

[O C Diver]

I would assume that part of the reason has to do with liability of owners and guests. If the policy includes coverage for bodily injury to yourself and guests, the number of people / days for a liveaboard is likely exponentially higher than the average dirt dweller who probably doesn't visit his boat once a week.

Would also guess the amount of alcohol or recreational drugs consumed on the average liveaboard is exponentially higher. I can think of 5 maybe 10 people who ended up in the water between the boat and finger pier after dark. Not saying all of them were impaired, but boarding the boat after 10pm can have its risks.

Ted

 

[Delta Riverat]

I dunno about insurance co's, but the marina allows a max of 10 days per month and no more than 3 consecutive or pay the additional for liveaboard.

 

[psneeld]

Im trying to figure out why a insurance company differentiates between living aboard vs not living aboard weather your clueless or not. I would think the clueless part would make more of a difference i.e headache for the insurance company. When you consider I have to pay a livaboard fee for each person on my boat, it starts to get real aggravating.

Insurance companies usually assume you are not a liveaboard unless you ask them for liveaboard insurance or they specifically ask how many days a year do you spend aboard or based on your requested navigation area is so large that you are going to hit that days aboard issue.

The big issue with liveaboard policies is they cover you for liability away from the boat. That is important to many who liveaboard and have no other liability coverage that homeowners and renters insurance would normally cover you anywhere you are.

Marinas charging you is a whole other ballgame of time aboard and number of people using facilities/utilities.

 

[tiltrider1]

I have never had a liveaboard issue with insurance. I deal with Red Shield. They only write policies on the West Coast and require riders for heading to Mexico or Alaska. By controlling their environment they control their risk. I recommend talking to Peter at Novamar Insurance in Seattle. He is a full time cruiser like many of us.

 

[Mac2]

I don’t have a dirt home. There are no facilities at my marina. Interesting comment on liability coverage away from the boat. My marina is the footprint of a burned down boathouse. Rags caught on fire-not disposed of properly. 4 million in damage. Bet they wish there was a livaboard to raise the alarm.

 

[SteveK]

Insurance companies most likely use statistics to determine how and what to insure. They may even ask why do you want insurance if you are there 24/7 to take care of everything, (said tongue in cheek).

They like to give insurance to people like me who hand over $$ every year and make no claims.

 

[Comodave]

Have you looked at many of the liveaboard boats in Florida?

 

[psneeld]

It's not only trashed boats that cost insurance companies money, it's often middle of the pack ones price wise that are owned by dreamers with no concepts or taking care of a boat.

They are often the ones in colder climes that plug multiple space heaters into a single extension cord on a 30A shore power, they are the ones that crunch multiple boats trying to get to the pumpout dock in a storm because they don't monitor their tank levels, they are the ones that leave a $20,000 flybridge enclosures up in a good nor'easter.....and on and on. The awful derelicts often seen in Florida and all along the ACIW probably don't have insurance.... so they are not the issue.

It's a whole new world of boaters with zero boating experience and trying a "new lifestyle"....plus some guys like my buddy who died aboard last year that everyone feared would burn/sink at the dock because of the zero maintenance done in a decade yet full time liveaboard. You couldn't really tell how bad from the exterior, but it was really bad and scary on the inside.

 

[MYTraveler]

During covid, my wife and I moved aboard our boat for about 6 months. My insurance was unaffected. I am not sure whether, in my particular case, the risk went up or down, as I can see factors going both ways. Conversely, insurance on our lake house did cost more because it is not our primary residence, but the credits I got for things like leak detection, alarm monitoring, caretaker, etc., brought the rate back down to close to what it would have been.

My experience with competitive insurance markets (ie, those big enough to be profitable to national carriers, without state regulation significantly limiting pricing) is that, unlike Lloyds, for example, when it insures a one-off risk, risk assessment is entirely a function of statistical analysis. I suspect that, contrary to reasonable expectations, live aboards are more likely to have more and bigger claims. If that weren't the case, some insurer with that insight would be making a killing by slightly undercutting the excessive premiums charged by its competitors.

 

[psneeld]

During covid, my wife and I moved aboard our boat for about 6 months. My insurance was unaffected. I am not sure whether, in my particular case, the risk went up or down, as I can see factors going both ways. Conversely, insurance on our lake house did cost more because it is not our primary residence, but the credits I got for things like leak detection, alarm monitoring, caretaker, etc., brought the rate back down to close to what it would have been.

My experience with competitive insurance markets (ie, those big enough to be profitable to national carriers, without state regulation significantly limiting pricing) is that, unlike Lloyds, for example, when it insures a one-off risk, risk assessment is entirely a function of statistical analysis. I suspect that, contrary to reasonable expectations, live aboards are more likely to have more and bigger claims. If that weren't the case, some insurer with that insight would be making a killing by slightly undercutting the excessive premiums charged by its competitors.

Not so funny to me...but insurance companies asked me for what experience I had and when I told them, they said I could have stopped on item number 3 or so.

The last 3 insurance companies gave me credit (it was multiple choice and they didn't care about anything else) was years boating, any claims and for a safe boating course and whether or not I was USCG Auxiliary. That included living aboard for 2 of them.

They didn't care about my liveaboard experience, my USCG experience, my assistance towing experience, my captains and boating safety teaching experience, my tech work in the boating experience, my operational risk management background, and so forth.

At some point we are just numbers with basically what kind of boat, worth how much, where is it stored and used, how many claims and any basic boating training one has.

 

[Mac2]

20 years boating, two different boats, no claims. Recent survey stating boat is valued at x.
If a boat is a floating disaster, a survey would show that. The value is the value. If I was not a liveaboard and took my boat cruising for several months, am I not a liveaboard? I have a metal boat and a lot of insurance companies won't insure a metal boat older than 25 years. Same issue. They don't look at the value/condition.
I thought that is what a survey was for. As some have implied above, I would think they would prefer to insure someone with years of experience with a boat valued at x, rather than someone with a brand new boat valued at x, but they are inexperienced.
What is irritating is the fact they have this blanket policy for liveaboards, but don't explain why. My brother is an insurance broker and no one can explain to him why there is this type of liveaboard policy. Seems to me that underwriters need to be educated.

 

[psneeld]

20 years boating, two different boats, no claims. Recent survey stating boat is valued at x.
If a boat is a floating disaster, a survey would show that. The value is the value. If I was not a liveaboard and took my boat cruising for several months, am I not a liveaboard? I have a metal boat and a lot of insurance companies won't insure a metal boat older than 25 years. Same issue. They don't look at the value/condition.
I thought that is what a survey was for. As some have implied above, I would think they would prefer to insure someone with years of experience with a boat valued at x, rather than someone with a brand new boat valued at x, but they are inexperienced.
What is irritating is the fact they have this blanket policy for liveaboards, but don't explain why. My brother is an insurance broker and no one can explain to him why there is this type of liveaboard policy. Seems to me that underwriters need to be educated.

They are educated, insurers have explained it to me and I have read it many times on boat and RV forums...... the basic concept of fulltimers/liveaboard policies and how they differ from standard policies.

They don't care who is who. They insure a mix of people where one balances the risks of others. Insurance companies make most of their money through investments and by not paying back premiums so they look to max input and minimum output. They don't have time, care about or have the inclination to look at individuals. If they claim to...it's because they adjusted their algorithm to make more money and the change fits into a new marketing scheme.

You fit the algorithm, or you don't get insurance with them. It's that simple and it's the same story I have heard hundreds of time for decades.

I hope no insurance experts are offended...that's not my intent...just what I have experienced. Our single biggest ally in the insurance industry is good, honest brokers that do have some influence up the ladder. I have had and know a few that I would trust with alot of things as they are good people...but they still often have to convince a juggernaut corporate chain on one's behalf.

 

[Hippocampus]

They only look at statistics. The statistically analysis is for as large a group as they can find. They are about profit and nothing else. It costs time and money to do a detailed analysis of each individual to include all the parameters that define that individual’s risk so they don’t do that. For some time now demand exceeds supply so they have little reason to expend resources for a complete collection of data and analysis.

This is true in all aspects of insurance. An example-my wife is the most careful driver I have ever known. She has had no claims and no tickets except one in her entire life. She was driving through Connecticut at 75mph in the travel lane being passed on both sides on rt 95. She was ticketed. Her insurance went up and will stay up for 5yrs.

We were on our boat after retirement for a decade. Only home for Xmas, spring break and summer. Did have a dirt dwelling which stood empty for most of the year. (Not considered unoccupied) We did a 2000nm passage twice a year. We were mostly in the less developed portion of the Caribbean most of the time with higher crime rates than the USA and much less governmental services (SAR, fire, law enforcement). We paid less for insurance than a friend with a sistership who snowbirded from Florida to Maine with the seasons. He also had no claims . I used him as crew and he was well skilled. However the algorithm insurance companies use isn’t detailed enough to capture his risk of a claim which logically was actually lower than mine.

 

[Solo_Nomad]

I dunno about insurance co's, but the marina allows a max of 10 days per month and no more than 3 consecutive or pay the additional for liveaboard.

You must really like staying at that marina. I wouldn't.

 

[psneeld]

You must really like staying at that marina. I wouldn't.

Ones that often have the strictest rules and are the most expensive is because there are few decent alternatives.

 

[SeaDogAK]

I don’t know about anywhere else, but most of the liveaboards in Juneau are people whose boats never leave the dock, and are barely maintained if at all. They’re not people who love boating, it’s just cheap housing.

The boat might have surveyed fine when they bought it, but I wouldn’t want to cover that risk if I was an insurance company.

 

[Delta Riverat]

You must really like staying at that marina. I wouldn't.

The rent is $375/mo for a covered and locked 50'x19' berth on a floating concrete dock with security cameras, 30A power, potable water and free pump outs.

Live aboard is only a hundred a month more but you get weekly pump outs. Mine are free, but I have to go to the office and request them. Seems quite fair to me.

 

[Mac2]

They only look at statistics. The statistically analysis is for as large a group as they can find. They are about profit and nothing else. It costs time and money to do a detailed analysis of each individual to include all the parameters that define that individual’s risk so they don’t do that. For some time now demand exceeds supply so they have little reason to expend resources for a complete collection of data and analysis.

This is true in all aspects of insurance. An example-my wife is the most careful driver I have ever known. She has had no claims and no tickets except one in her entire life. She was driving through Connecticut at 75mph in the travel lane being passed on both sides on rt 95. She was ticketed. Her insurance went up and will stay up for 5yrs.

We were on our boat after retirement for a decade. Only home for Xmas, spring break and summer. Did have a dirt dwelling which stood empty for most of the year. (Not considered unoccupied) We did a 2000nm passage twice a year. We were mostly in the less developed portion of the Caribbean most of the time with higher crime rates than the USA and much less governmental services (SAR, fire, law enforcement). We paid less for insurance than a friend with a sistership who snowbirded from Florida to Maine with the seasons. He also had no claims . I used him as crew and he was well skilled. However the algorithm insurance companies use isn’t detailed enough to capture his risk of a claim which logically was actually lower than mine.

My question is referencing statistics. If someone said the majority of claims coming from marina boats is liveaboards and listed specifics I.e. boats catching on fire in the winter because liveaboards use massive amounts of electricity for heaters to keep warm and cause electrical fires, then I would get it, but they don't.
If they know something I don't, I would sure like to know. I'm surprised they havn't outlawed the old style electric plugs and mandated the smart plug yet (as an example).

 

[Mac2]

The rent is $375/mo for a covered and locked 50'x19' berth on a floating concrete dock with security cameras, 30A power, potable water and free pump outs.

Live aboard is only a hundred a month more but you get weekly pump outs. Mine are free, but I have to go to the office and request them. Seems quite fair to me.

So your saying your moorage fees are just a little more than my liveaboard fee......(weeping now).

 

[psneeld]

My question is referencing statistics. If someone said the majority of claims coming from marina boats is liveaboards and listed specifics I.e. boats catching on fire in the winter because liveaboards use massive amounts of electricity for heaters to keep warm and cause electrical fires, then I would get it, but they don't.
If they know something I don't, I would sure like to know. I'm surprised they havn't outlawed the old style electric plugs and mandated the smart plug yet (as an example).

I am confused...what exactly is your beef with insurance companies and liveaboard policies?
If you get a "liveaboard policy" because you ask for it or it is determined by your answers.... and the liveaboard policy gives you additional liability coverage, increased personal property limits and a few other things....paying more is because it is a better suited policy for you over a standard yacht/boat policy.

 

[Delta Riverat]

Yeah, but hey this is the Delta - The rent is more than double in the Bay Area and you are in an open slip.

 

[Mac2]

I am confused...what exactly is your beef with insurance companies and liveaboard policies?
If you get a "liveaboard policy" because you ask for it or it is determined by your answers.... and the liveaboard policy gives you additional liability coverage, increased personal property limits and a few other things....paying more is because it is a better suited policy for you over a standard yacht/boat policy.

My beef is that I can lie and get a cheaper rate for the same thing. I don't like to lie. I have a liveaboard policy. I was wanting to shop around to compare prices. I was told to get a survey. I got a survey. I was told to pound sand without a look. This rubs me the wrong way. Maybe you like to be told to pound sand without a reason. I don't.