Value estimate for insurance?

[Frank Langer]

I would appreciate any help in determining the value of my 1984 Ericson 30+ for insurance purposes--I don't want to under insure the boat, but also don't want to pay more for insurance than necessary, as we are on a fixed retirement budget.

We have owned the boat for three years, and when purchased, the survey described it as substantially updated and in excellent condition. Some highlights: Universal 16 hp diesel engine with 740 original hours, mainsail and headsail replaced in 2004 and in good condition; standing rigging replaced in 2001; lifelines replaced in 2008; water heater replaced in 2001; prop shaft, cutless bearing and folding prop new in 2005; Harken roller furling new in 2001; holding tank and hoses replaced in 2001; autopilot, depthsounder, knotmeter new in 2000; mast repainted in 2001; all lines led aft; new steering wheel/pedestal in 2002; propane stove and heater; 2 water tanks; all brightwork in good condition/varnished; gelcoat in very good condition; running rigging in very good condition; 5 self-tailing 2 speed winches; dodger, bimini, spinnaker.

The boat is in British Columbia, so some appreciation of the Pacific Northwest/BC market would be helpful.

I can provide any additional information anyone may need to give me a reasonable estimate of what I should insure this boat for--ie. reasonable replacement value. I will eventually make my decision based on my initial purchase price, taking into account the current economic slump and reduction in boat prices, and my best guess on what similar boats are selling for these days. But your help in estimating it's value would be helpful as additional information in making my decision.

Thanks for any help on this.

Frank.

 

[treilley]

Frank, my boat was valued by the surveyor when I bought her 3 years ago. I got her for a deal and immediately the boat was valued at more than what I paid. I have done substantial upgrades and refinishing. I have everything documented and I presented to the Insurance company this year. They increased the value of my boat $15k which raised my premium but I felt better as we had 2 close calls with huricanes this past fall.

So if you have a starting point and you know the value of the work that has been done to date then you should use that to determine her present value.

 

[Loren Beach]

Determining "Value"

It seems like you would want several factors weighed in determining insured value. (1) Market Value would look at replacing your exact model with a same model, presuming there are some regularly for sale. (2) Condition and Equipment would then look at your exact boat, focusing on its condition and fitness for purpose, and state of systems, from keel to engine to sails and standing rig, and all plumbing and electrical stuff in between. (3) Geography would enter in at some point, i.e. if you have a common design with hundreds of sister ships nearby or IF in your case you have few around and a replacement would have to be trucked for thousands of b.u.c.'s

On any boat over a decade in age, you should follow Tim's advice and document all upgrades and improvements and provide this to the insurer. Actually, this is not totally unrelated to what we homeowners do for our real estate when we save the receipts for all work on the house over the decades to adjust the taxed valuation someday when we sell the house for (usually/hopefully a lot) more than we paid for it.
( Cynically speaking, if you own a boat with a large production run, you may benefit from doing zero maint. and on the day the mast comes down or the boat is flooded from rotting thru hulls just smile and cash the insurance check for the average value... You would come out ahead monetarily and never worry about how your "zero maintenance program" is raising all of our premiums. )

Geography gets involved when you have, say, an Ericson 35-2 in the SF Bay, and there are normally some sisterships for sale and it is at least possible to replace your boat without transport charges. For someone up in BC or owning a model with only 30 or 40 sisterships ever built (like my Olson 34 or Mike's Ericson 33RH), it may not even be possible to source another one - from anywhere - for several years.

If our boat became an "insured loss", we might have to take the check whether we wanted to or not!

I must have left something out, I keep thinking, but this board is well staffed with knowledgeable owners who can fill in all the places I missed!

Regards,
Loren

 

[Brisdon]

Aside from the actual amount that the boat is insured for, make sure you have an "agreed value" policy. That means that they can't change what they decide the boat is worth at the time of a total lose. They have to pay you outright what is specified in the policy. I learned this the hard way when the docks blew out a few years ago and my boat was set adrift. My insurance tried to reduce the value of my boat in order to total it, and benefit from the salvage bid on the back end of the settlement. I had to go to an arbitration with them. I had gathered and presented the closing prices for every e35-2 that had sold on the west coast in the previous 12 months along with my last survey, and I won. So I got my repair check and didn't lose the boat, but it shouldn't have taken 6 months and all that headache to get through it. You pay higher premiums for agreed value, but it's better peace of mind.