Your shipyard does a variety of jobs, often at different locations. You want to be able to tell your customer, “Yes, we can do that for you.” But keep in mind that your insurance policy can have a narrow set of coverages, and if you stray outside those boundaries, you might not be covered. The following are just a few of the areas to think about when trying to expand your insurance coverage.
Should you have occasion to send your employees to work on a boat at a location other than the one listed on your current policy, the Traveling Workmen Endorsement is a smart addition. It adds to your existing Marina Operations Legal Liability (MOLL) coverage and extends its limits to the vessel you are working on, whether at sea or in any port within the United States, while your employees are on board for the purposes of repair or alteration.
MOLLs are designed to cover operations related to boatbuilding and repair. They can also cover fueling, docking, and hauling. The work that your yard does is listed and covered on the MOLL. But what about the rare job you may take on, or the favor for a neighboring business? Are these covered? By including the phrase “and other similar boatyard operations,” you may have a chance. This catch-all phrase can help provide coverage where there may have been none.
Do you have a workboat used by your employees? You may have a coverage gap if an employee is injured operating the boat without crew coverage included. The burden is on the employee to prove in federal court that he is a seaman. While the rule of thumb is that a third of his time must be spent in service to the vessel, that threshold has been lowered in certain cases. Adding crew coverage extends your protection and indemnity coverage and avoids a painful gap.
Help prevent a sharp lesson in marine insurance by discussing with your agent what your yard is doing and the coverages that will protect it. Remember, once a claim occurs, it is too late to make the changes you need.
