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Compass F inan ce INSURED TIDES Now that you’ve found your dream boat, you need to insure it. Don’t simply go with the broker’s recommendation; do your homework by contacting a number of insurance agents. TEXT BY BILL LINDSEY There are many factors to take into account when choosing boat insurance. This includes knowing if the company is financially solvent. Insurance companies are prohibited from filing for bankruptcy under the federal bankruptcy code; if they do go under, the government usually steps in. This is the purpose of state-run insurance guaranty associations. This, however, doesn’t assure you a complete bailout. Most of the associations have “per claim” payment caps; you need to know your policy’s limits. Go online to review the company’s Standard & Poor’s or A.M. Best rating to assess the company’s financial security. Choosing an agent is equally important. You want someone who can help you determine the level of risk you can afford, based on your assets. Look for someone who can easily explain the legal aspects of the policy, such as deductibles, exclusions, limitations, negative bounds, claim denials and more. Search for an agent with significant experience in marine policies as opposed to one who mostly covers cars and houses, and is less likely to devise a policy that covers all contingencies. The agent plays a critical role in the event you ever have to file a claim, so make sure yours will represent your interests; do an online search to see how they are viewed by their existing clients. Several factors will determine the quote you receive, including prior boat ownership, holding a USCG captain’s license and your credit rating. Most insurance companies review credit/income ratios when determining boat insurance rates. Canceling any cards you don’t use may help lower the rate you pay. At a minimum, a good credit score will provide access to a wider selection of insurance companies. Next, start the process of securing insurance as soon as you can. While some policies have been written in as little as one hour, it’s best to plan on 48 hours to one week between submitting an application and a policy being issued. If a survey is needed, the timeframe can easily expand to 2 weeks or longer. Resist the urge to fudge the facts; don’t make your boating history sound better on the application than it is. If you file a claim and the insurance company discovers any of the application info was fraudulent, they may deny all coverage. Once you have a policy, read all renewals thoroughly to make sure you know if deductibles, coverages, and exclusions have changed. 48