What is Actual Cash Value on Boat Insurance?
When you’re shopping for boat insurance, there are a lot of different terms that you will hear. One of the terms you may come across is the term “actual cash value.” But what does actual cash value mean? This is an important term to know, as it will actually determine the type of boat insurance coverage you have. In this article, we will be discussing what exactly actual cash value means, as well as how this will affect your boat insurance in one way or another.
What is Actual Cash Value?
Actual cash value is the actual worth of your boat at the time it’s damaged or destroyed. This is different from other types of boat insurance, which may cover the replacement cost of your boat. Actual cash value, however, will only cover amounts up to the value of the boat at the time of the incident.
Like how a car’s value depreciates over time, a boat’s value does the same. Actual cash value will decrease over time as your boat depreciates. So, any wear and tear that your boat faces will come into account when your boat’s value is being determined. This type of coverage also includes coverage of items like accessories and equipment that are permanently attached to your boat. So, the more bells and whistles that your boat has, the higher the actual cash value will likely be.
Is Actual Cash Value the Same as Other Types of Boat Insurance?
Not all boat insurance policies use actual cash value. Some policies may cover the replacement cost of your boat, regardless of depreciation. It’s important to read the fine print of your policy to see what type of coverage you have.
Actual cash value is the actual worth of your boat at the time it’s damaged or destroyed. This type of coverage takes into account the depreciation of your boat, and includes items like accessories and equipment that are permanently attached to your boat. Actual cash value is different from other types of boat insurance, which may cover the replacement cost of your boat. It’s important to read the fine print of your policy to see what type of coverage you have.
The difference between actual cash value and other types of boat insurance coverage is that actual cash value takes into account the depreciation of your boat. Other types of boat insurance may cover the replacement cost of your boat, regardless of depreciation.
Actual Cash Value vs. Agreed Value
Now that you know about actual cash value, it is good to know about agreed value boat insurance as well. Agreed value insurance will cover up to a certain amount that was previously agreed on. Sometimes, this amount will actually be higher than the cost of your boat itself. The thing with agreed value boat insurance is that it will not cover all accidents or repairs. The nice thing about agreed value boat insurance is that you know exactly how much you will be getting back when you submit a claim. However, these policies can be more expensive than actual cash value policies.
What is Covered by Boat Insurance?
If you have a boat insurance policy, your boat will be covered for any perils that it faces. It’s important to keep in mind that your boat will likely not be covered if the issue is caused by wear and tear, infestations, and other things of the like. Essentially, if something would have been preventable with proper maintenance, your boat will not be covered by insurance. It is, however, covered by unforeseen perils. These often include:
- Lightning
- Fire
- Physical damage
- Theft
- Collision
- Expenses if you cause damage to another boat
- Bodily injury of another person
- Fuel spill liability
Some boat insurance policies are specifically liability coverages. This means they typically only cover costs of things you are liable for – such as damage to another boat, or injury to another person. Other policies allow you to add on optional coverage, in addition to all of the regular coverages. Some optional coverages you may find available are:
- Towing
- Disappearing deductibles
- Ice and freeze coverage
- Personal property coverage
- Fishing coverage
Keep in mind that every policy will cover different things. When you sign up for a boat insurance policy, you cannot automatically assume that it will cover all of the above. This is why you must read the entire policy to make sure it is going to cover everything you need. If you would like assistance for this, you can contact us at Robinson & Stith! Our agents will help you make sure that you have all the coverage you are looking for.
Find Boat Insurance With Robinson & Stith
There you have it! A quick overview of actual cash value on boat insurance. Now you can make an informed decision about what type of coverage is right for you. If you are looking for boat insurance near the Crystal Coast of North Carolina, contact us here at Robinson & Stith! We are able to help you find the best boat insurance coverage for the best price. Not sure if you would prefer an actual cash value policy or another kind of coverage? Don’t worry – our expert agents are here to help you decide which is the best choice for you. Contact us today to get started on obtaining boat insurance coverage.