Includes copyrighted material of Insurance Services Office, Inc., with its permission.

May 9, 2017

Water sports are tremendously popular and include cruising, sailing, racing, rowing, diving, snorkeling, sightseeing, waterskiing, and other recreational activities. The 2011 National Recreational Boating Survey reported 22.2 million boats within the United States. Boats can range from canoes to luxury yachts. The most popular boats are power boats, followed by row or inflatable boats. In 2015 there were 11.87 million registered boats. Not all boats need to be registered however; canoes, kayaks, and many other small boats are not required to be registered.

Boats, like any other vehicle, have their risks of damage or injury to passengers or others. Insurance is of course needed. ISO has a watercraft policy WT 00 01 01 10 to provide needed coverage. As with any policy, there are some things that an insured may want to add that is not needed by all insureds. Various endorsements are used to provide such coverage. This article analyzes the ISO watercraft endorsements.

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Personal Watercraft Coverage WT 05 01

The Personal Watercraft coverage endorsement is designed for jet-skis and similar craft. The endorsement shows “personal watercraft” as a defined term but does not define it. The definition can be found in the Watercraft Policy WT 00 01 WT 00 01 01 10. “Personal watercraft” is defined as a recreational watercraft powered by an inboard motor with its primary source of energy being a water-jet pump, and is capable of carrying one or more people in a sitting, standing or kneeling position. This is your basic jet-ski.

 

The endorsement begins with a schedule – a description of the watercraft is needed, whether or not the passenger hazard is excluded, and desired coverages for each watercraft listed.

Definitions

I. Definitions

The definition of “your covered watercraft” is replaced by the following:

“Your covered watercraft” means:

1. Any “personal watercraft” shown in the Schedule or in the Declarations.

2. Any “personal watercraft” on the date you become the owner. This provision applies only if you:

a. Acquire the “personal watercraft” during the policy period; and

b. Ask us to insure it within 14 days after you become the owner.

3. Any “personal watercraft” you do not own while used as a temporary substitute for any other “personal watercraft” described in this definition which is out of normal use because of its:

a. Breakdown;

b. Repair;

c. Servicing;

d. Loss; or

e. Destruction

Analysis

This section defines “your covered watercraft”. Covered watercraft are “personal watercraft” listed in the schedule or the declarations, and newly acquired “personal watercraft” on the date the insured becomes the owner only if acquired during the policy period and the insured asks for it to be covered within fourteen days of acquisition. Also included are “personal watercraft” the insured does not own but that are used as a temporary substitute for the covered “personal watercraft” because the covered vehicle is out of use due to breakdown, repair, servicing, loss or destruction.

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