Choosing Your Boat Insurance /

Yacht Insurance

Marine hull and machinery insurance specialist

Naval Officer with Diver Cert

Our founder, Captain (NS) Andrew Ang was a Navy Captain and a certified diver with the Naval Diver unit of RSN.

Who has the best boat insurance in Singapore?

That depends on what do you really want at the end of the day and it’s usually depend on the values the policy offered or the premium you’re prepared to pay. At Raffles Provident LLP, we will help you identify your real needs, source for better coverage/quotes and help you make a good informed decision.

How much is boat insurance?

It could cost a few hundred dollars for a $25,000 sum insured third party liability coverage which is a requirement by the regulator, MPA (Maritime and Port Authority of Singapore). For comprehensive coverage, different factors might affect the premium: from less than 1%, to as much as a few percent of the total market value of your vessel.

What does boat insurance cover?

Pleasure craft insurance policies basically cover for physical damages and liabilities that your boat experiences. Physical damages can be the accidental loss and damage to your boat, while liabilities refer to your legal obligations to the third parties involved. Typically, there are two common types of pleasure craft insurance.

Third-party coverage covers the financial cost of any damage you might have accidentally caused to other individuals, boats or even property.

On the other hand, Comprehensive coverage covers both third party liability and first party losses. This means that it also protects your personal financial loss in the event of an accident. 

As with all other kinds of insurance, by purchasing the right pleasure craft insurance, you can rest assured that you are financially secured in the event of an accident.

Do I need boat insurance?

It’s a requirement by the regulator, MPA (Maritime and Port Authority of Singapore) to get your boat covered by a minimum $25,000 sum insured third party liability insurance coverage. If you have hired a crew from foreign land to operate your boat, you are also required by MOM (Ministry of Manpower) to purchase work injury compensation insurance, as well as foreign workers medical insurance.

Tips on Choosing Your Boat Insurance

Some boat owners purchase insurance because it is a compulsory requirement by the Maritime and Port Authority of Singapore (MPA). One thing that really impresses me is that most boat owners realise the importance of transferring all their financial risk to the insurer and will choose to purchase a comprehensive boat insurance for their boats.

As a professional boat insurance agent, I would encourage all my clients to consider buying a comprehensive boat insurance based on the agreed fair market value of the boat, rather than on a lower value. Reason being, as a boat owner, damages covered by your insurer will be compensated to as high as your insured value. For example, if the boat sinks and is beyond economical repair, you may seek insurance claim for the cost of replacing your boat up to the insured value. It might also include expensive charges like removing the wreck of a sunken boat from the sea bed, if required by the MPA or other government authorities.

Other important factors to look at are the financial strength, core product and the support of your insurer. You may check out their financial strength ratings by agencies like Standard & Poor’s, Moody’s and Fitch. There are about 38 general insurers in Singapore offering highly competitive insurance products. It is important you seek out the strength, not just the insurance premium. Also consider who is your insurance adviser and the company behind the adviser. Investing in a boat is a long term commitment to many, and it is wise to work with a long term partner who can help you to protect your boat with the right insurance coverage.

There are always two sides to every coin. Knowing the benefits of your insurance policy is only the first step. You should either try to read the insurance contract or seek professional advice from the adviser about the following clauses in the boat insurance contract, namely:

  • Exclusions
  • Liabilities to third parties
  • Excess and deductible
  • Salvage charges
  • Duty of Assured
  • Unrepaired damage
  • Constructive total loss
  • Speedboat clause
  • Cancellation and return of premium,
  • Other exclusions

Like buying the insurance for your car, premium for boat insurance are affected by several factors. The underwriters of the insurance companies will base on the following factors to work out a reasonable premium for boat owner – insured value, length of boat; age, type of boat (i.e. powered or sail), type of engine(s), mooring location, intended area of navigation, previous boating experience, claim history of the owner and deductible amount. Sometimes the underwriter will also consider the automobile driving record of the owner(s), and whether they have taken any safe boating courses.

To sum up, it is important to get the right insurance for your dream boat. Buy it with reasonable amount of understanding. Buy it through a trusted insurance adviser to ensure your dream stays “well protected”.

Captain (NAVY, NS) Andrew ANG(AEPP, AFC, AIFP, B. (1st Class Hons) E. Eng, Cert SCI (GI, LI, HI), CLU, ChFC, FChFP, MFSP, NLP Trainer & Consultant, JobEQ consultant)

Raffles Provident LLP

Hp: 8448.7168; Office: 3112 1488 ; Fax: 3145 7168

* this article was published on BOAT Asia 2013 magazine

Seaworthiness of a vessel

Insurance companies usually require a satisfactory condition and valuation survey on the vessel.

Our recommended surveyors are:

(a) Capt Kang
Horsburgh Marine Services Pte Ltd
Mobile: 96323704

(b) Capt Bird
Seabird Consultants
Tel No. 63567396

Extract from the MPA website

Insurance Policy

  • Applicable to all mechanically-propelled pleasure craft equipped with outboard or auxiliary engine, and non-mechanically pleasure craft which are 7 metres and above in length. The policy must cover the third party liabilities including wreck removal, personal injuries, etc. e.g. under Clause 11 of the Institute Yacht Clauses (IYC) (1/11/85). The minimum sum insured is S$25,000/- for any one accident or occurrence. It should cover the period up to the next expiry date of the craft licence. The insurance company must be a Singapore-registered company. If the insurance company is a foreign one, a letter from the local representing office confirming same must be submitted.

Buying for the right coverage?

Some may say that buying boat/yacht insurance is quite similar to buying a motor car insurance. However, I’ll say it’s a lot more than buying a motor car insurance. When the car stops working, you can easily get someone to tow it back to the car workshop. When you’re out at the sea, there are also many factors like wind speed, sea current, and the unpredictable sea weathers, especially with the recent terrible climate changes. I am speaking as a long term sailor who has sailed with the Singapore Navy for more than a decade. I was a Navy Captain and even the Naval ships were subjected to all these factors.

Just recently, a less than 1-year-old, nice looking yacht, sank in Singapore water. The yacht owner, having the penny wise and pound foolish mentality, chose not to insure his own expensive yacht to save money. If this can happen in the sheltered and relatively safe water like Singapore water, think about the consequences where our neighbour has sank more than 300 boats recently, for fishing in their water territory. Water territory is not like land territory, where you can be 100% sure that you are in Singapore or out of Singapore.

Also, we are in an infamous water piracy place, known as the Piracy in the Strait of Malacca. Many boat/ yacht owners probably didn’t know that this is not only the world’s top water piracy places – it’s also an ultra long 900km sea lane.

Another factor many boat/ yacht owners only realise when they start sending their boat/ yacht for repair work is that in Singapore, we don’t have many professional engineers or technicians to service or repair your broken down boat/ yacht, unlike the Europe, USA and Australia. This means that the repair cost will not be as reasonable as what most are expecting. I was an engineer by training and I did some practice professionally in the Marine industry myself some years ago. My sincere advice is talk to the REAL experience people before choosing your next boat/ yacht. Be sure you are covering your crew with the compulsory insurance required under the workers injury compensation act, cover your passengers, as well as your own personal liability.

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