When you're buying insurance coverage for your boat, there are several types of policies that will cover an array of damage. The two main types that cover full and partial loss are actual cash value policies and agreed value policies. Both have benefits and drawbacks, and which you should ask your insurance agent about depends on your situation and use of the boat.

Agreed Value Boat Insurance

When you get this type of policy, you and your insurance company will agree on a value for the boat. This is usually its replacement cost, what it would cost you to get a new one. If the boat is a complete loss, that's how much you'll receive to cover it. If there's any damage to the boat, your payment will be based on the cost to replace the damaged parts with new ones. Wear and depreciation don't factor into the calculation, with a few exceptions for parts that are expected to wear out regularly. This is the more expensive type of policy, but it makes it easy to restore your boat after any accidents.

Actual Cash Value Boat Insurance

Actual cash value policies do take depreciation into account. They pay the current market value of the boat or the damaged parts, meaning the price for a used item in similar condition. Although this means a smaller payout and a more difficult time restoring your boat, this type of coverage comes with a smaller premium that allows you to pay less over time.

If you're looking for insurance for a boat or any other piece of property, visit Tim Bryan Insurance in Andalusia, AL. Serving Covington County, Tim is a State Farm agent, Life Underwriting and Training Course Fellow®, and a member of the local chamber of commerce. He strives to provide affordable, comprehensive coverage while also building up the Andalusia community. To get started, call (334) 222-1460 or get directions online today.