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Thread: Insurance costs for Multihull vs Monohull

  1. #1
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    Default Insurance costs for Multihull vs Monohull

    (If I were asking this on CF, I'd probably get booted)

    It occurs to me that, if multihulls are safer than monohulls, their insurance costs should be less, since the insurance industry bases pricing on actuarial statistics and loss histories.

    So, dear insurance agents, for representative multihulls and monohulls comparable in cost, location, age, usage, relative level of quality, etc, etc, etc, would there be a difference in premium, and if so, how much proportionally.

    - Rusty

  2. #2
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    Default Re: Insurance costs for Multihull vs Monohull

    Isnt it based more on replacement or insured value? I dont think our insurance costs are out of line. Our new cat is insured for twice what our last one was and ins only went up 25%. or it could be that monos sink fast and well if theres no one around to payout the insurance to,,,,,,

  3. #3
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    Default Re: Insurance costs for Multihull vs Monohull

    Quote Originally Posted by HappyEnding View Post
    our insurance costs are out of line.
    A typical politicians mis-quote, but consider this

    The average premium is say 2% boats value (to make the maths easy). So if fifty St Francis catamarans are insured the insurer gets the full value of one boat each year in premiums. So does a St Francis become a total loss each year?

    I doubt it. So insurance companies must be making a lot of money.....

    despite sailing her Mainecat41 in New Zealand Susan Waters,

    susanw.imis@gmail.com

    who posts here, has been very prompt and helpful for me and given good quotes, so I'd contact her

    Richard Woods of Woods Designs

    www.sailingcatamarans.com

  4. #4

    Default Re: Insurance costs for Multihull vs Monohull

    Quote Originally Posted by rgesner View Post
    (If I were asking this on CF, I'd probably get booted)

    It occurs to me that, if multihulls are safer than monohulls, their insurance costs should be less, since the insurance industry bases pricing on actuarial statistics and loss histories.

    So, dear insurance agents, for representative multihulls and monohulls comparable in cost, location, age, usage, relative level of quality, etc, etc, etc, would there be a difference in premium, and if so, how much proportionally.

    - Rusty
    It's not just total losses. There are claims for damage, lost dinghies, personal gear and theft etc, which won't neccessarily vary between mono's and multi's.

    And as a percentage of the value insured, my insurance actually IS cheaper for this boat than it was for my old mono.

  5. #5
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    Default Re: Insurance costs for Multihull vs Monohull

    The point/question is, if *ALL* other things, values, accessories, etc are equal, is there a difference between insurance costs for a mono vs cat?

  6. Default Re: Insurance costs for Multihull vs Monohull

    Quote Originally Posted by Woods Designs View Post
    A typical politicians mis-quote, but consider this

    The average premium is say 2% boats value (to make the maths easy). So if fifty St Francis catamarans are insured the insurer gets the full value of one boat each year in premiums. So does a St Francis become a total loss each year?

    I doubt it. So insurance companies must be making a lot of money.....

    despite sailing her Mainecat41 in New Zealand Susan Waters,

    susanw.imis@gmail.com

    who posts here, has been very prompt and helpful for me and given good quotes, so I'd contact her

    Richard Woods of Woods Designs

    www.sailingcatamarans.com
    Richard,

    Thanks for the kind words.

    Here's a bit to add to your calculation on insurance companies: They are businesses, just like any other. So they pay for advertising, fax machines, phone lines, employees, benefits for those employees, office rent, utilities, and all the other normal business expenses. It not just as simple as adding up the premiums and subtracting the payouts from the total premiums. In fact, many insurance companies run an underwriting loss, i.e. they pay out more in claims than they receive in premiums. They do this in good economic times because they take your premium money and invest it- using the "float" so to speak. However, in bad economic times, they don't make money on their investments, so they respond by trying to make more on the underwriting side of the business, and so your rates go up.

  7. #7
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    Default Re: Insurance costs for Multihull vs Monohull

    And the insurance companies pay out claims for a lot of losses which are less than totaled boats ... but that is all irrelevant to my original question, which I'd hoped a knowledgeable agent might answer:
    All other things being equal, does a cat or a mono pay higher premiums?

  8. #8
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    Default Re: Insurance costs for Multihull vs Monohull

    Quote Originally Posted by rgesner View Post
    And the insurance companies pay out claims for a lot of losses which are less than totaled boats ... but that is all irrelevant to my original question, which I'd hoped a knowledgeable agent might answer:
    All other things being equal, does a cat or a mono pay higher premiums?
    I am not sure where you think this is going to help, other than ease the pain when renewing insurance

    Different insurance companies looking at identical cars in the same location with drivers of equal experience will still ask for different rates, so how do you expect to provide a level playing field for totally different vessel types, with potentially different repair costs?
    Insanity is continuing to do the same thing and expecting different results

  9. #9
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    Default Re: Insurance costs for Multihull vs Monohull

    Rgesner, FWIW when I changed, some years ago, from a 26ft mono to a 26ft cat, both old boats, with the same insurer, my premium went down slightly.

    Mike
    Nothing works on an old boat, except the skipper.

  10. #10
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    Default Re: Insurance costs for Multihull vs Monohull

    Mike,

    What were the relative values of the boats?

    Thanks - Rusty

  11. #11
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    Default Re: Insurance costs for Multihull vs Monohull

    Quote Originally Posted by rgesner View Post
    Mike,

    What were the relative values of the boats?

    Thanks - Rusty
    I've forgotten, it was some time ago! Both were then 25 to 30 years old. Both roughly the same at about 20k.

    Mike
    Nothing works on an old boat, except the skipper.

  12. Default Re: Insurance costs for Multihull vs Monohull

    Q.
    All other things being equal, does a cat or a mono pay higher premiums?
    A. It depends!
    Some companies do surcharge a bit for catamarans; I don't agree with it, but it is true in some cases. Other companies are eager to insure Cats, since they usually have higher hull values than the same length monohull, and are easy to maneuver under power. It may turn out that the company that surcharges for cats gives you credit for experience that offsets the surcharge. So when we get a request to cover a cat, we often try a few companies to find the best match of coverage and cost.

    Best Regards,
    Susan
    IMIS

  13. #13
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    Default Re: Insurance costs for Multihull vs Monohull

    Anyone who thinks insurance companies are sophisticated enough and knowledgeable enough to fine tune rates to take into account individual boat safety features - not to mention individual skipper/owner capabilities - is sorely naive. They are not that smart.

    2 Hulls Dave

  14. Default Re: Insurance costs for Multihull vs Monohull

    Anyone who thinks insurance companies are sophisticated enough and knowledgeable enough to fine tune rates to take into account individual boat safety features - not to mention individual skipper/owner capabilities - is sorely naive. They are not that smart.
    They have years of historical data of claim payouts. Some boats even have known manufacturing issues. So while past performance is not always a guarantee of future results, it certainly is a good indicator. And regarding individual skipper capabilities, surely an owner who has been boating for 15 years and crossed the Atlantic is a better risk and deserves a better rate than a newbie who has never owned a boat before.

    Best Regards,
    Susan
    IMIS

  15. #15

    Default Re: Insurance costs for Multihull vs Monohull

    Sometimes one does have to wonder a bit about the intellegence of the Insurance companies. The best example I know of is the insurance situation near ape Hatteras with regards to hurricanes. I had my boat in a well protected marina 30 miles inland, but ten miles south of the lattitude of Cape Hatteras so I had a higher premium because of hurricanes. I asked what i would have to pay if I kept my boat at he Cape Hatteras marina. I would get a discount because it is about a mile north of the lattitude of Cape Hatteras. Yet it probably gets hit by more hurricanes and tropical storms than any place else on the planet. Go Figure? It sure seems like their being a little simple minded about how they determine the true risk.

  16. #16
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    Default Re: Insurance costs for Multihull vs Monohull

    Not a comparison between multi and mono but I've been hunting for multi quotes recently and I'm a little shocked at the range of pricing.
    The premiums for a $130K cat ranged from $1,700 to $3,100. I did my best to get them to quote on the same variables and amounts (e.g., $500K for third party liability, cruising area, etc.). The difficult thing now is to sift through the terms and conditions of each quote to determine which is the best suited for our situation.
    Last edited by reynishl; 27th May 2013 at 11:07 PM.

  17. #17
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    Default Re: Insurance costs for Multihull vs Monohull

    Don't forget that some companies, for their own reasons may actually want the business.

    Conversely,there will also be others who have enough of that category of cover or risk. So for reasons that are nothing to do with skipper or boat, will quote a high premium. This will either discourage the owner, or provide unusually lucrative business.

    Mike
    Nothing works on an old boat, except the skipper.

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