Protect your summer fun: Find the best watercraft insurance in Minnesota

Did you know 8% of Minnesotans¹ own at least one motorized boat? With Independence Day around the corner, up to 830,000² boats and pontoons can potentially hit the lakes and rivers throughout the Gopher State. If you’re one of them, you’ll want to take a moment to review your watercraft coverage — or make an appointment to get insurance if you have it.

Why Minnesota boaters need watercraft insurance

Boating, jet-skiing and pontooning are safe and fun summertime activities for the thousands who get out and enjoy Minnesota’s plethora of lakes and rivers. But accidents do happen. The combination of speed and deep water is what makes boating fun, but it’s also part of the risk. Even though Minnesota does not require watercraft insurance, financially savvy boat owners keep it as a financial shield in case something does happen.

How common are boating accidents in Minnesota? Here are some stats from the Department of Natural Resources³ from 2022:

15 boating fatalities on Minnesota waters, which is right in line with the 10-year annual average of 14.7 deaths. (All 15 fatalities were drownings where the victim was not wearing a life jacket; many had one on board the vessel.)
78 non-fatal boating accidents in Minnesota, with a 10-year average of 73.2. The 78 accidents include:

27 collisions with other watercraft
10 falls overboard
8 collisions with a fixed or floating object

To reduce the risk of an accident on the water, it’s important to know and practice boating safety. When we’re sharing the lakes and rivers with others, we don’t always have the power to avoid collisions. That’s highlighted by the fact that some 30% of Minnesota’s boating accidents are alcohol-related.

Boats are expensive to tow, repair and replace. Without good coverage, you’ll face sticker shock in the wake of a collision. When planning a weekend of fun on the water, having a sound watercraft insurance policy can provide peace of mind of financial protection.

How much boat insurance do you need?

The following shows the types of coverage, so you can choose what’s best for your family. Basic liability can meet your needs if you only pontoon on a secluded lake a few times a summer. But if you spend much of your summer boating on a busy lake or river with family, you may want to investigate a more robust policy.

Liability

Like your vehicle insurance, liability coverage for watercraft covers the costs of accidental damage to someone else’s property, along with medical bills to anyone who got hurt.

Comprehensive and collision watercraft coverage

You can take on additional insurance to cover the costs of damage to your boat caused by events that are beyond your control, such as:

Severe weather
Falling limbs or trees
Fire
Theft and vandalism
Collisions with other watercraft or objects in the water
Capsizing

Uninsured/underinsured boater

Because Minnesota does not require watercraft insurance, this coverage is well worth having. If you or your passengers become injured by another boat, and the owner of the other boat is uninsured or underinsured, this coverage could pay for a claimant’s medical expenses.

Portable boating equipment

Pay attention to whether your insurance policy covers “portable boating equipment”, which is defined by Progressive as “detachable equipment customarily kept in or on a boat for the maintenance or use of the boat.” This type of equipment might include items like life vests, water skis or anchors, but may not include fishing gear. Check the details of your policy for specific coverage information.

Requirements vary from state to state

It's important to note that insurance coverage requirements and laws can vary significantly from state to state. It’s important for boat owners to understand the specific insurance regulations in their respective states.

Consult with an independent insurance agent who is familiar with the laws and regulations where you live. They can provide personalized advice and help you navigate through the complexities of insurance requirements.

What type of boat insurance do you need? Actual cash value vs. agreed value

There are two types of boat insurance to choose from: actual cash value and agreed value coverage. Knowing the difference is important because it impacts the size of your settlement if your boat is damaged or totaled.

Actual cash value factors in depreciation of the watercraft when insurance issues a settlement for repairs and replacement. The advantage of actual cash value coverage is it has a more attractive premium cost.
Agreed amount coverage is based on agreed-upon valuation of the watercraft at the time you purchase coverage. The cost of premiums is typically higher than that of actual cash value, but boat owners find it offers more complete coverage for repairs and replacement.

Boats and pontoons generally lose 30% of their value in the first three years of ownership, and the costs to repair and maintain are typically higher than those for road vehicles.

Your choice ultimately comes down to your comfort with risk and what you’re willing to pay. Would you want the settlement to be enough to cover repairs and replacement? Then agreed amount coverage is the best option for you. If you’re comfortable with actual cash value, be prepared to take on higher out-of-pocket costs to replace and repair.

Can you get a discount on watercraft insurance? Check with your agent. Some insurers offer a discount if you complete the DNR’s course on water and boating safety.⁴

Do I need insurance to tow my boat?

When it’s time to tow your boat to the cabin for the summer, check the liability policy on your car or truck for trailer coverage. Many policies include coverage for damage and injuries caused by the boat and trailer.

Otherwise, additional collision coverage can cover damage incurred to your boat and trailer.

Compare watercraft rates with our independent agents

Set up a meeting with one of our helpful agents on the insurance team at Minnwest Insurance Agency. We’re located in hometowns throughout Minnesota and southeastern South Dakota. As independent agents, we can compare rates from numerous insurance companies, so you can get the best coverage at the best value for yourself and your family.

Personal insurance products from Minnwest:

Auto and recreational vehicle insurance
Homeowners insurance
Flood insurance
Personal liability insurance
Life insurance
Health insurance
Umbrella insurance
Aviation insurance
Renters insurance
Watercraft insurance

Call or meet with an independent insurance agent at Minnwest Bank today!

Minnwest Insurance Agency, Inc is an affiliate of Minnwest Bank. Products offered through Minnwest Insurance Agency, Inc are: Not a deposit | Not FDIC insured | Not insured by any federal government agency | Not guaranteed by the bank or an affiliate of the bank | May go down in value (if applicable)