Actual Cash Value (ACV)
The value an item would sell for on the open market. Policies that pay ACV will have lower premiums than those that pay Replacement Cash Value (RCV).
Agreed Value
The amount agreed upon by you and your insurer that you would be paid in the event of a total loss.
Bilge
The area on the outer surface of a ship’s hull where the bottom curves to meet the vertical sides. The bilge of a ship or boat is the part of the hull that would rest on the ground if the vessel were unsupported by water. The “turn of the bilge” is the transition from the bottom of a hull to the sides of a hull.
Blue Water
Water that is five or more miles from land.
Brown Water
Water that is less than five miles from land.
If you only plan to use your boat during certain times of the year, you can save on insurance premiums by placing date restrictions on your policy that specify the time periods that the boat is covered.
Bow
The bow is the front section of a boat, opposite the stern. It is designed to cut through water efficiently, improving navigation. The shape of the bow can affect the boat’s speed and stability. Many boats have a raised bow to help with wave resistance. The bow often features a railing or pulpit for safety and functionality. Anchors are typically stored or deployed from the bow area. A ship’s bow should be designed to enable the hull to pass efficiently through the water.
Cleat on a Boat
A cleat is a metal or plastic fitting on a boat used for securing ropes. It typically has two horns that allow for easy tying and untying of lines. Cleats are essential for docking, mooring, and securing sails. They come in various sizes and designs, suitable for different types of boats. Proper use of cleats enhances safety and stability while on the water. A safe practice is to always ensure cleats are securely mounted to prevent accidents.
Deductible
The amount that you will pay out‑of‑pocket for a loss before your insurance policy will pay.
Depreciation
Reduction in property’s value over time. Depreciation is taken into account when calculating an item’s actual cash value.
Dinghy/Tender
A small boat, often carried by a larger boat.
Disappearing Deductible
A deductible that decreases by a percentage every year that no claims are filed.
Emergency Services
With regards to boat insurance, this is coverage for recovering a sunken boat or towing a disabled vessel.
Endorsement
A document that modifies the coverage provided by an insurance policy; often referred to as a rider.
Exclusions
Those things that are specified in an insurance policy as not covered. “Acts of war” is a common example.
Helm of a Boat
A helm boat refers to a vessel equipped with a steering mechanism. The term “helm” denotes the area or equipment used to control the boat’s direction. Helm boats can vary in size, from small dinghies to large yachts. They are commonly used in recreational boating and sailing. The helm typically includes a wheel or tiller for navigation. Safety features are often integrated into helm boats for better control. The helm of a boat refers to the equipment and area used to steer and control the vessel’s direction, typically including the steering wheel or tiller and associated controls.
Hurricane Deductibles
Under some policies, damage due to hurricanes may be covered with a higher deductible than other losses.
Keel
The longitudinal structure along the centerline at the bottom of a vessel’s hull, on which the rest of the hull is built, in some vessels extended downward as a blade or ridge to increase stability.
Latent Defect
A manufacturing defect that was undetectable by the insured using normal testing methods.
Lay Up Dates
Times during which a vessel is required by the insurance policy to be unused, although coverage is still effective.
Liability
Legal responsibility for an occurrence.
Limits
The maximum dollar amounts that a policy will pay for a covered incident.
Navigational Limits
Limits specified in a policy defining where you can use your boat and still be covered.
Operators
Those who will operate the boat.
Personal Watercraft (PWC)
A small, water jet‑powered vessel that the rider either sits on or straddles while riding.
Pollution Liability Coverage
Sometimes called fuel spill coverage, this covers containment and cleanup costs resulting from a fuel or oil spill.
Replacement Cash Value (RCV)
The cost to replace a covered item with a new one, regardless of the item’s age. Policies that pay RCV, unlike actual cash value (ACV), do not consider depreciation.
Rider
A rider modifies an insurance policy’s coverage in some way and is considered part of the original policy.
Risk
The likelihood of a covered event occurring.
Running Aground
Run aground is a phrase that primarily means to ground a ship or vessel unexpectedly on land or a shallow area of water.
Salvage Coverage
Not included in all boat policies, salvage coverage covers major incidents requiring rescuing or salvaging a boat. Sinking or running aground are two examples of such events.
Stern
The rear end of a boat
Total Loss Replacement
Coverage that will pay to replace a boat with a new one of the same make and model in the event of a total loss.