Originally Posted by night0wl
Brian - Legacy was freed....it also is a perfect demonstration of why insurance is a scam. a boat like that is un-insurable or have ridiculous out policies for losses. Most people with yachts like that are forced to self insure. Insurance premiums, especially in proverbial high loss areas like florida, are not trivial. In my neck of the woods, premiums alone (not deductibles, co-pays, co-insurance, etc) are in the neighborhood of 2-3% of agreed value. Not to mention, they pay out in depreciated value.
If one is smart and has resources, they should think about self insurance! Put aside the money paid in premiums and have a catastrophe fund that can help bring the boat back. But then again, I would also carry a umbrella liability policy for $1-$2MM. A common "gotcha" of an umbrella policy is that they require you to have $300k of liability coverage on the underlying asset before they begin coverage.
I disagree. That is a perfect point of why to have insurance. Crap happens. It may or may not be your fault. But don't risk your entire investment over a small outgo. Insurance companies make their money by spreading their risks everywhere. They are kept in check through competition. As individuals, we can't do that. If you had owned legacy, for example, what would you be looking at out of pocket? Can you really cover the costs of hitting a 2 million dollar hatteras? A diesel spill on the reef? Torn up sea grass in a environmentally sensitive area? The loss of your boat in a hurricane?
Here is another very recent case in point: Very good friends of ours lost their engines in Nassau. The Bahamian government refused to let Sea Tow or any US company in to tow them back to the US, where they had to go for a replace. They insisted that BASRA do it (as did BASRA). As such, their quote for tow was $125/mile until they were out of Bahamian waters... FROM NASSAU! I think that ended up being close to $15,000... but I don't remember now. How many years of premiums until you have paid $15,000?
I am not saying insurance does not have some scam aspect to it. I also think that everyone should have the right to have it or not as they see fit. I was on record as saying that earlier. However, you need to know the risks and be financially prepared for them.
By the way, I have your insurance too. I am currently in Marathon. I have paid for all of the US, from Texas, all of gulf coast, all of keys, Bahamas-Turks, Atlantic all the way up to Canada. If you don't like your insurance rate, you should take a gander at mine!!! $225k hull value.
But the whole discussion in some ways is pointless. I have seen a real predominance in insurance requirements. As I said, even Mantanzas Pass requires it to even tie up to their ball for a day??? I don't agree with that, but what other choices do I have? Harborage requires being listed on the insurance. It is not up for discussion. Marathon Marina, Snook Bight Marina, etc, etc. It seems the number of marinas that do not require insurance are dropping, while the number that do are growing. What choices do you have as boaters? You can either anchor everywhere (not really reasonable), search for the dwindling marinas that don't require insurance, buy a house on the water to park your boat behind, or give up boating. I really do see a day when pretty much everyone 'has' to carry it.