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People who brag about being “self-insured” are like people who brag about having the tools to perform brain surgery on themselves.

Aground on Reef.

Dick was a smart guy. He loved to stand on the beach, his bare feet washed by the waves, telling people that he was a smart guy. He didn’t use those exact words. No, he was too smart for that. He’d use other phrases so that people would naturally come to that conclusion on their own. They were phrases like, I sailed all the way down the coast from the Vineyard, single handed, without coming ashore once. Or, I’ve never once dragged anchor. Or, I don’t throw away money on things I don’t need. Like, for example, I’m self-insured. The crowd (well maybe not quite a crowd) standing around hanging on his words thought this sounded really cool. Because most of them were accustomed to having spent, year after year, big bucks to be insured … and most of them had never made a claim. They felt cheated.

Then came the storm. It wasn’t a special storm, just one in which, for a change, things didn’t go well for Dick. You know the feeling. It happens to all of us. It even happens to some of us a lot. Dick’s boat dragged anchor. Yes, he had anchored well, or so he thought. But nevertheless he dragged. Dick was asleep. He awoke to that dragging feeling. Instead of swinging nicely into the wind your beam is to the wind and the gentle lap of waves on the bow is the ugly sound of waves on your beam. Then you hear horns blowing all around you from other boats. They’re frantically trying to tell you to get your butt out of bed and deal with your problem.

But it’s not just your problem. It’s also the problem of boats downwind of you. And with many dragging situations it’s the problem of boats off to the side. Because, as your anchor drags across the bottom it prevents your boat from doing its normal thing. Instead the boat has its beam or stern or bow quarter to the wind and it sails back and forth, from one side to another, as it drags downwind. The only way you can really stop this is to get your anchor up but this takes time if you’ve put out a lot of scope and the weather is foul. So a lot of boats and people are in danger of being injured, not just the poor blokes who were so confident of your abilities from your beach talk that they had anchored directly downwind of you.

This dragging scenario is very common. It happens to be best of us and the worst of us. It’s just a part of it. We’re all in it together. But not like Dick. Because when Dick dragged it was extra special … because wise man Dick was “self-insured.”

The Meaning

Now we get to the true nitty-gritty meaning of “self-insured.” Because, you see, Dick’s boat dragged down on three other boats. It only dragged on one at first, but it pulled that boat’s anchor loose and the two, helplessly entwined with anchor chains, bowsprits, rigging and dinghies, continued dragging in a merry whirly wheel arrangement snagging the other boats as it just got worse and worse. Finally, to everyone else’s relief, they stopped dragging because they grounded on the reef. As poetic justice would have it, Dick’s boat was farthest downwind at the time of impact. The swinging circle of fate (and boats) just put him there first so that the other three boats were grinding into his topsides as his keel was grinding into the reef. And Dick, you will recall, was “self-insured.”

By the next morning when the wind had died and the clouds had cleared and after the man with the crushed hand (who had been on one of the other boats and trying to fend off) was air lifted out, the gravity of the matter got even more gravitational. (No, I didn’t just make that last word up. It’s a real word, but I don’t think it means what I thought it meant when I put it down.)

The man and his wife wanted Dick to pay for the plane and the doctors and the hand and, as it became clear that he couldn’t, they told him they were going to see a lawyer. Now you may think that Dick had the last laugh here, standing on the beach saying “I’m self-insured and there’s nothing for that lawyer to get because all I had was my boat.” But he wasn’t laughing. The owners of the other boats were also unhappy. They had the audacity of wanting Dick to pay for salvaging and repairing their boats. But it was obvious that Dick couldn’t pay for a watered down beer. People in the harbor began to remember one of Dick’s jokes as he used to stand on the beach talking about being self-insured. When people would ask him about where this concept of “self” would come in if he hurt somebody else, he’d laugh and say, I’ll just sail away. There’s a lot of water and a lot of islands out here.

But under the circumstances, this plan wasn’t working. His boat was holed on the reef, its rigging a shambles, and his port side splintered. As people began to talk, it was reported that Dick was seen slinking about looking for a way off the island. Until it was reported that he was in jail. It seems there was also an immense oil slick around his boat and several hundreds of years of coral growth was crushed under his keel. This sort of thing was called “severe environmental damage” by the government. And you know how governments are. They get their flesh if they want it. One way or the other. And they did. This being an offshore island nation, there weren’t the same rules for the protection of criminals and bums that other nations had, so it didn’t take long. Dick couldn’t pay the fine or cleanup costs. He was “self-insured.”

If Dick had been insured with a good policy, Dick probably would have had a much better experience. As he sat in jail, he wasn’t comforted by the thought that he couldn’t really walk away from his fellow boaters whom he had so cavalierly regaled on the beach with his self-proclaimed omniscience. They wanted to be paid damages for their boats, their lost goods, their injuries and a lot of other things. Fortunately for Dick, they couldn’t get to him, at least yet. At times, Dick was glad to be in jail.

This is a story I made up … but not really. The name certainly is totally made up, but I’ve known of scenarios similar to this over the years. The moral of the story is clear. And if anybody ever tells me he’s “self-insured,” I tell him he’d better figure out what he’s talking about.

Tom’s Tips About a Few of the Things to Look For in Boat Insurance

  • Is there good coverage for environmental damage?
  • Is there good coverage for salvage?
  • Can you get limits of navigation extensions to cover your trip plans?
  • Are you paying extra for cruising where you don’t go?
  • Are boat contents adequately covered?
  • If it’s a live aboard policy, is there any coverage for temporary lodging?
  • Is there coverage that helps you prepare for severe storms, such as captains to move your boat and sharing of haulout fees?
  • Can you call the company and talk to a person who is helpful?
  • Are their different types of coverage and different types of fees so that you can get what you need but don’t have to pay for what you don’t need?
  • Is there a strong company backing up the insurance so that they will be there if you need them?
  • Read the fine print. It is incredibly important. If you have questions ask them.

Tom Neale

Technical Editor, BoatUS Magazine