Insuring a personal watercraft

Why the home policy usually stops short

Homeowners policies extend limited cover to small watercraft, and the extensions are generally written by size and by power. A personal watercraft is small but not low-powered, and power is usually what puts it outside.

Where the liability extension does not apply, there is no liability cover at all for how the machine is used — which is the half that matters, because the claims are injuries rather than damage to the machine.

The property side of a home policy, where it applies at all, is capped at an amount usually below what a PWC costs and applies contents perils rather than marine ones.

What a PWC policy covers

Broadly the same shape as a boat policy, applied to a smaller machine.

• Physical damage to the machine, on an agreed value or actual cash value basis
• Liability for injury and for damage to property that is not yours
• Uninsured or underinsured boater cover for injuries caused by someone with nothing
• Medical payments for modest costs without establishing fault
• Trailer cover, sometimes as part of the policy and sometimes separately
• Wreck removal and fuel spill, which apply to a PWC as they do to any vessel

Who is allowed to operate it

Policies commonly attach conditions about operators — an age, a level of experience, or a requirement that the owner is present — and these conditions are enforced more tightly on personal watercraft than on other vessels.

This matters because PWCs are lent freely. A machine handed to a visiting nephew for an afternoon is the classic uninsured claim, and the reason is a policy condition rather than an exclusion.

Separately, local law commonly sets a minimum operating age and may require a boating safety certificate. Those rules vary by where you are, so check locally rather than assuming the policy and the law say the same thing.

Passengers, wake and the injuries that follow

Most PWC claims are injuries, and a substantial share involve a passenger, a person being towed, or someone in the water nearby rather than a collision with another vessel.

Injuries to people you are towing — on a tube, wakeboard or ski — are worth a specific question, because some policies limit or exclude cover while towing a person.

Damage caused by your wake is a liability claim like any other, and marinas and moored vessels are where it usually lands.

Storage, transport and the rest of the year

Cover on the trailer while towing on the road generally falls to the auto policy for liability, while damage to the machine itself is frequently not covered by it — the same three-policy gap that catches trailered boats.

Theft is a more realistic risk than for a larger vessel, and policies commonly ask how and where the machine is stored and secured.

Where a lay-up period applies, using the machine on an unseasonably warm day inside it can be uninsured, and nothing about the day announces it.