What Are The Boat Insurance Requirements In The State Of Texas?

4 March 2015 by Elijah Steward

Being a boat owner and living in Texas may not seem to go together. The public perception of the state of Texas may be one of lots of wide open land and plenty of oil, but not a great deal of water. In fact, the spectacular Rio Grande river runs throughout the state, as well as the Red River and the Brazos River. To best enjoy these beautiful rivers, it's ideal to maintain your own boat, but what kind of insurance do you need?

The State Requirements

According to the laws in the state of Texas, you are not legally required to maintain boat insurance on watercrafts that you own outright. However, many people who have boats are in the process of paying for them on an installment plan, and this changes the ownership.

The Lender Requirements

If the bank is still the official owner of your boat, they can require you to maintain boat insurance as long as you still owe money on it. This is a safeguard for the lender's investment.

If your boat is damaged, stolen, or destroyed, you are still legally responsible for paying off the loan. Banks typically require insurance because people who suffer a big loss may be less likely to pay off a loan on a boat they can no longer use, or that they no longer have possession of.

The amount of boat insurance required varies widely according to lender. The amount of required insurance may be closely tied to the total value of the boat, or the total amount still owed on the watercraft. Be sure to read your buyer's contract very carefully to make sure you secure adequate boat insurance.

How Boat Insurance Helps You

Maintaining boat insurance is typically a very smart financial move, even if you may not be legally required to do so by the state. Some of the main benefits of maintaining boat insurance include

• Protection From Legal Claims: When you are piloting a boat, you are responsible for what might happen on the waterways, just as you are responsible for damages you may cause when you're driving your car. If you cause serious damage to another person, or to another person's boat, they may choose to take legal action against you to recover damages. Your boat insurance will cover these damages if the other party wins a lawsuit.
• Help With Repairs or Replacement: Sometimes disasters do happen, especially on the water. For example, your boat may be damaged in a storm. Your boat could be stolen, or it could be seriously vandalized. Any of these things could cost a considerable sum to fix if you don't have insurance to help.

While it may be tempting to look at the lack of required boat insurance in Texas as a good opportunity to save a few bucks, consider what skipping boat insurance would mean long term. You'll probably find that the risk just isn't worth it. Talk to your local insurance agent, one like The Flechsig Insurance Agency Inc, about arranging a low cost policy for your boat today so you don't have to take that risk!

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