Whether you’re a dealer, a manufacturer, or a boat owner, when you’re looking to ship a boat over land, there is one very important item to consider: the type of insurance coverage your trucking company has.
Every legitimate yacht transporter who travels interstate must obtain authority from the Federal Motor Carriers Safety Administration (FMCSA) to do so. This is a multi-step process that cannot be accomplished in a day, or even a week.
Among other things, the carrier must show proof of auto liability coverage in the minimum amount of $750,000. However, auto liability coverage won’t help you if your boat gets damaged while being transported. What you need is proof of motor truck cargo insurance. But the FMCSA doesn’t track cargo coverage on boat transporters. While checking a carrier’s SAFER score (safersys.org) is a very smart thing to do, chances are you won’t find any information about a carrier’s cargo insurance.
Here’s what you should do:
Ask you carrier to have their insurance agent send you a certificate of insurance showing the carrier’s policy information. If the certificate doesn’t come directly from the agent, call the agency listed on the certificate to verify coverage.
The certificate should include:
- Agent information
- Name of cargo insurance company
- Policy number
- Effective dates of policy
- Amount of coverage
- Any deductible amounts that apply
- Whether or not it is an “all risk” policy
- Boat owner named as certificate holder
The amount of coverage should ideally cover the value of the boat being transported. You should also note the value of the boat on the bill of lading at time of loading.
“All Risk” policy is the best
An “all risk” policy will cover any damage caused by the carrier while the boat is on the carrier’s trailer.
Be wary of any “named peril” policy. What that means is that damage is only covered under certain conditions, which are listed in the policy itself. We’ve seen policies that exclude coverage if damage occurs while the load is “unattended.” The driver, at some point, will need to stop for fuel, or food, or a bathroom break. If someone backs into the load at the truck stop during any of these times the load might be “unattended”, coverage could be denied.
Some named peril policies specify that damages “caused by a roadbed” are excluded form coverage. Overpasses are considered “roadbeds.” If the carrier takes that load under a bridge where there isn’t enough clearance and the top of the boat hits the overpass, causing damage – that claim could be denied under that policy.
According to Rodger Strandskov of Knight Consulting Services, “Many truckers carry only a Scheduled Vehicle/Specified Peril policy, which is totally unacceptable since it voids some of the necessary coverage that you need. These policies are cheaper for the trucker, but do not protect the shipper.”
If the certificate you are given indicates “named peril”, you should request a copy of the actual policy from the agent listed on the certificate so you know what those limitations are.
Additional Insured vs. Certificate Holder
Many people request being named as an “additional insured” on an insurance certificate. That’s fine on an auto liability policy, but cargo policies are different. Being named an “additional insured” on a cargo policy actually negates coverage, because you’re asking to be treated the same as the carrier, who doesn’t have any ownership interest in the boat and won’t receive any payment in the event of damage. Being named a “certificate holder” on a cargo policy should protect the owner’s interest in case of damage caused by the carrier.
Proper preparation is key
This is an entire topic unto itself, but any shipper should be aware that the boat must be fully and properly prepared for overland transport according to the carrier’s guidelines. Failure to do so may result in a damage claim being denied by the carrier and/or insurance company. Click here for our Free Boat Prep Guide...
Steps you can take
The best steps you can take to ensure a safe and pleasurable boat transport experience are:
- Make sure you hire a legitimate, licensed and insured interstate carrier
- Make sure the carrier has the proper cargo insurance
- Make sure the boat is properly prepared for overland transport
We are that carrier
Joule Yacht Transport, celebrating its 64th year of yacht transporting, is fully licensed and insured, carrying an all-risk motor truck cargo inland marine policy for $2,000,000 with a $10,000 deductible. Additional insurance can be obtained as needed.
We invite you to contact us for a quote or further information about our company.