Maritime law broadly defines the liability of the operator of a charter boat as liable for all damages resulting from “negligence.” This all-encompassing definition leaves the operator open to the possibility of costly and endless court cases.

This is why the value of selecting a yacht charter insurance policy that protects your legal rights, property, and guarantees reimbursement for damage to your boat cannot be underestimated.

How can you identify which components should be on your policy? First, identify all of your business activities and the risks involved in operating your yacht charter business. This information will help you decide the types of components, the range, and the amount of coverage needed.

Hull and machinery clause

This refers to the coverage of the boat and all its parts. Your main goal is to get your business and your boat up and running quickly after accidents. If it is allowed to choose a policy that covers the following damages that your rental boat may suffer:

Combustion, sinking or collision of your boat.

Deck machinery, boat engines and electronics.

Coverage for an engine that breaks down.

However, the following are not included in the hull and machinery component: Damage to your engine due to improper use or neglect, wear and tear due to daily use of the boat, or refunds due to your engine breaking down.

Protection and indemnification clauses (P&I)

These clauses allow you to pay passengers and others who may have suffered personal injury or property damage caused by your vessel.

The basic clauses that you should consider are the following:

Coverage limit

How much is your business worth? A smart agent will tell you that the best coverage limit is the one you can get. It makes sense since the P&I marine policy covers it per incident, not for each person.

Shore excursion

If your insurance policy does not have this clause, your passengers will not be insured once they get off your ship.

Crew coverage

You must pay coverage for each crew member, or you will be liable for injuries to uninsured crew members in the performance of their duties.

Passenger medical payments

A good clause to have, as you are protected from irate passengers who, even if they have suffered minor injuries, will still file a lawsuit for major damages.

Personal effects

Losing clothing, fishing gear, or cameras may seem like a minor inconvenience, but not to the passenger who suffered the loss. This clause guarantees that it is properly covered and that your passenger leaves happy.

However, talk to your agent to find out what items are covered in the personal effects rider and whether it is appropriate to include them.

Remember, the right boat rental insurance policy for you is one that insures both your boat and your boat rental business.