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Insurance: Navigational Limits and Surveys for Full Crewed

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As a vessel Owner or Captain, I have to ask you, when is the last time you took out your insurance policy and perused what your insurance company defines as the vessel’s navigational limits?  It is important to understand exactly what they are.  Insurance companies are quick to look for ANY reason to deny a claim. 

Before you prepare for a voyage, check your policy to see if you will be navigating through an area that is NOT included on your current insurance policy.  If so, it’s time to pick up the phone and get that area added BEFORE getting underway.  Be sure to obtain a hard copy of the revised policy.

One Owner informed us that his insurance company instructed him that he must comply with ALL deficiencies in a recent report of vessel survey (not just the safety deficiencies) before proceeding to sea.  All vessel surveys should be sent to your insurance company.  Get written confirmation from your insurance company that they have received the survey (even if it is just an email reply).  Had the Owner failed to send the insurance company the recent report of survey, the insurer could deny a claim, simply because the survey was not supplied to them.

At any rate, one of the “deficiencies” listed in the vessel’s survey was a cracked toilet seat.  It took quite a few phone calls and emails to finally get the insurance company to take that off of their list of items that had to be corrected before proceeding to sea (the Owner got that in writing).  If the vessel sustained damage and the toilet seat had not been repaired or replaced, the insurance company could possibly deny a claim on the basis that ALL of the deficiencies in the report of survey were not corrected before proceeding to sea.  Silly, but true. 

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Once all deficiencies have been complied with, get your second survey evidencing same and (you know the rest of the drill) send it to your insurance company.  Get it in writing that they received the second survey.

And while you are now frantically reading through your insurance policy, be certain to have a good look at what your insurance company defines as “fully crewed.”  If your policy states that your vessel must be “fully crewed at all times,” then you must comply with that provision.
If anything happens on board the vessel (fire, vandalism, sinking, etc.) and you do not have the required crew on board under the policy at the time of the incident, then your claim will most likely be denied.  Many yacht owners only employ a “part time captain and crew,” who do not stay on board 24/7.  This does not meet the “fully crewed” requirement.

Make certain you fully understand your insurance policy and comply with all provisions therein.

Gail Wasserman is Senior Director of Ashmead & White Consulting, Inc., a maritime and aviation solutions company based in the Virgin Islands.  Previously, Gail was Director of Paralegal Services in a law firm based in South Florida which served these industries.

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