As folks dig out from the destruction that Hurricane Irma left in her wake, we were reminded of some aspects of marine insurance as they pertain to named storms like Irma and Hurricane Harvey before her. As we have seen, storms like these produce losses. Good preparation can mean the difference between small easily repairable damages like:
Versus losses which can more difficult to swallow:
Marine insurance is often underwritten with higher Hurricane or Named Storm Deductible (NSD) for vessels in areas subject to hurricanes, and tropical storms. The NSD is naturally higher than the normal hull deductible and applies when the vessel is damaged due to a named storm. The amount of the NSD varies among insurers. Some do not add a NSD. But it is not unusual to see deductible of 2%, 5% or 10% of the hull value.
More relevant for cruisers and liveaboards might be “The Box” which are geographical areas where historically some insurers might refuse to offer coverage between certain dates. As an example, an insurer might insist that between certain dates (likely to correspond with the Hurricane Seasons in the tropical regions of the Atlantic or Eastern Pacific oceans) the vessel must be outside these zones in order for coverage to remain in force.
Sometimes owners of vessels will be required to submit in writing a “hurricane plan” to include such details as whether the vessel will be hauled and blocked ashore during hurricane season, whether the vessel will be manned, number of lines used to secure, distance in feet between neighboring moored vessels, height of pilings, whether the vessel would be moved to a hurricane hole, etc. As seen from the photos above planning and preparation can greatly impact the severity of losses.
We wish all people in Florida, Texas, Alabama, Mississippi, Louisiana, the Bahamas, the Virgin Islands, Turks and Caicos, Barbuda, Puerto Rico and all other affected places who are digging out from hurricane damage our sincere sympathy for the damage and loss of life.© Sunrise Marine Risks and sunrisemarinerisks.com, 2017. All rights reserved.