Guide: What to do after a claim?

Sometimes it's their own fault, sometimes it's just bad luck. The fact is: yachts run aground, collide with other ships, lose their masts, spring a leak, get the odd scratch or are raided by thieves. Fortunately, all of this happens extremely rarely compared to the total number of sailors and boats. But it does happen.

This is why there is insurance. The majority of German boat owners have one. And don't need it for the rest of their lives. That's a good thing.

As a result, hardly anyone thinks about what to do if an incident does occur. Call the water police? Take the boat to the nearest boatyard? Hire a damage surveyor? And if so, where to get one?

It makes perfect sense to contact your insurer as soon as possible after a claim. The experts will then explain what needs to be done. In this way, the extent of the damage can be minimised if possible. They will then ensure that the damage is repaired as quickly as possible.

You should also seek advice from the insurer even if it appears to be a minor claim. If further and, above all, more extensive consequential damage suddenly occurs later, it is good to be able to document the course of the damage from the outset. In addition, the damage experts usually also have experience in recognising when damage is actually hardly worth mentioning and when the ship should perhaps be taken to the nearest repair yard as soon as possible.

Step 1: Prevent damage

First and foremost, a ship must be seaworthy. Of course, as a customer you can hardly influence the design of a yacht, you have to rely on the manufacturer. However, a buyer can at least make sure that the equipment is right.

In the experience of loss assessors and insurance experts, many boats are by no means always seaworthy ex-shipyard. You have to take care of this yourself, for example by ordering the safety packages offered by many manufacturers at the time of purchase.

The ORC safety guidelines and associated supplements from the Cruiser Department of the German Sailing Association provide a good indication of what is sensible on board. They are available for free download, even for non-members, at www.kreuzer-abteilung.org.

If a ship has the recommended equipment, the owner is on the safe side if the worst comes to the worst, at least vis-à-vis his insurance company. The insurance company cannot accuse the owner of having set sail with a ship that is unseaworthy.

In addition, every skipper should of course be able to operate a boat in the sailing area in which they are currently located. Ideally, they should have sufficient sailing experience and be able to prove this, not least with appropriate sailing licences.

It also makes sense for every skipper to take part in radio and safety courses. After all, the best rescue equipment is of little use if it cannot be used correctly or quickly enough in an emergency. Example: If you fight a fire on board with the wrong extinguishing agent, you run the risk of significantly increasing the damage that has already occurred.

Good seamanship is the best preventive measure

On the other hand, a boat can be protected against theft with comparatively little effort. If you secure outboards and forecastle boxes with padlocks and make sure that larger hatches cannot be opened from the outside, you have already done a lot. The companionway bulkhead should also be stable and lockable.

In addition, loose items of equipment have no place on deck or in the cockpit during longer periods of absence, so don't stow your expensive binoculars or winch cranks permanently in the swallows' nests. Only items that naturally belong on deck may be stored there from an insurance perspective. For example, the boat hook, the fenders or the rescue collar. You don't need to plug any of this in either. If you want to go one step further, you can have valuable equipment engraved by the police. Depending on the region, such campaigns are organised from time to time. Police stickers on outboards or on navigation electronics deter many thieves. And if something does go missing, it can easily be traced back to its owner later if it is found.

To avoid any trouble with the insurance company, it is also advisable to keep the boat papers in order. So keep a copy of the boat's passport at home, if possible, as well as important invoices and purchase contracts. An inventory list, preferably supplemented with photos, can also be helpful. This increases credibility after a theft and is particularly recommended for over-equipped boats. After all, if someone reports two or three high-quality binoculars or more than one on-board computer as stolen, they must expect the insurance company to make critical enquiries and request supporting documents.

Step 2: Minimise damage

Safety for life and limb comes first. Insurers don't see it any differently. Nevertheless, they can expect an owner to do everything in their power to at least minimise the consequences of damage if they are unable to avert a mishap or accident.

Such obligations, known in insurance jargon as obligations, are not a speciality of the yacht insurance industry, but are included in every policy. The point is that the insured person, who can derive certain legal claims from the contract, must also fulfil certain conditions.

In this context, however, it should be expressly pointed out that incorrect behaviour does not lead to the loss of insurance cover as long as you act to the best of your knowledge and belief. What counts is showing initiative and not simply relying on the insurance company to pay out.

Example: After a mast breakage, for example, the skipper must ensure that the hull does not leak due to striking parts.

If it is necessary to have a yacht salvaged and a professional company or even a local fisherman is available, it is essential to insist on Lloyd's Open Form. This is an internationally recognised standard contract between a salvage company and a casualty at sea.

Furthermore, damaged equipment must not be removed immediately if possible. Always keep torn sails or a faulty furling terminal, due to which the mast has come from above, for some time to preserve evidence. Even if you have already been given the go-ahead for the repair. Reason: The insurance company should have the opportunity to have a damaged part inspected by an expert.

Act as if you were not insured

Sometimes creative measures are also required to minimise damage. A few years ago, for example, the owner of a Hunter Legend 450 laminated a piece of rock that had got stuck in the bow below the waterline after a grounding into the hull. This saved the boat from sinking. It was later towed to a shipyard and repaired.

If you have the opportunity, you should also inform the insurance company from the sea as soon as there is no longer any immediate danger to the ship and crew. They may be able to provide valuable support or help to minimise the damage.

However, insurance experts unanimously emphasise that under no circumstances should a shipyard be commissioned to carry out repairs prematurely. In the case of damage to new ships, for example, the companies regularly check whether any recourse claims can be made against the manufacturer. This is quickly nullified by unauthorised repairs.

In the event of theft, fire or even an explosion on board, the police must also be involved in addition to the insurance company. This can also be useful in the event of personal injury, for example to record the course of the accident or to preserve evidence of equipment that led to the accident.

In Germany, no authorities have to be informed in the event of ship-ship collisions. Depending on the country, however, other accidents must be reported by law; in Croatia, for example, even the smallest grounding.

In Germany, a report can be made to any authority. It is then their task to call in the relevant colleagues from the coastguard, water police, fire brigade or environmental and water and shipping authorities if necessary.

By the way: Ships flying the German flag that sink or suffer another serious accident, no matter where in the world, must be reported to the Maritime Authority. This then carries out an official investigation. In the event of a breach of the obligation to report, the owner not only faces criminal prosecution. They also jeopardise their insurance cover.

Our checklists show you at a glance what to do in the event of theft, a collision with another ship or another serious accident.

Step 3: Settle claims

As soon as the first opportunity arises, prepare an accident report and send it to the insurance company. The broker or insurance company will provide the relevant forms, often as an Internet download. Then wait for the repair order.

Under no circumstances should you initiate repairs yourself without the insurance company's approval, unless it is clearly intended to minimise the damage. In the case of more serious damage, the insurance company will commission an expert to assess the damage. Based on his work, it will ultimately be determined how much money the owner can expect to receive from his insurance company.

If there is a dispute about the amount of damage: "Above all, don't order any repairs before clarification has been reached," advises Hamburg lawyer and water sports expert Dr Heyko Wychodil. Even if this drags out the whole process.

If you act prematurely, you risk losing your insurance cover

Some insurance companies not only have the amount of damage determined in an expert report, they also ensure that the damage is repaired professionally and, if desired, support the customer in finding a suitable repair company.

Owners' concerns that the insurance company might have the work carried out by a low-cost provider are unfounded. The insurers themselves know all too well that word would spread quickly. On the contrary, the companies live from their good reputation in the sailing community.

Lawyer Wychodil also confirms: "The owner should normally be able to assume that the insurance company will commission qualified specialist companies to repair the damage. After all, it is also in their interest to have a properly repaired ship in their customer portfolio afterwards."

If an expert can be dispensed with in the event of minor damage, the owner must obtain a cost estimate himself and then submit it to the insurance company.

If the boat is finally repaired in a repair shop and the actual costs ultimately differ significantly from the initial estimate, you should also contact the insurance company immediately. This also applies if the company announces higher costs in the meantime. In this case, have the work stopped immediately and consult the insurer first. If in doubt, the insurer will reassess the amount of damage.

How much money flows also depends on the small print

However, the actual amount of compensation depends not only on an expert opinion or a cost estimate - the small print in the insurance policy is decisive. There are sometimes serious differences between time and replacement value compensation or the so-called fixed rate. You can find out what to look out for in the contract here.

With a good replacement value indemnity, the insured person receives new equipment or even a new ship without any ifs and buts. What's more, it also covers customisation expenses. This means that if a damaged or stolen item of equipment is no longer available on the market, meaning that a similar part has to be purchased, but which entails structural changes to the ship, for example, the costs for this are also covered.

This can be the case, for example, with a stolen GPS chart plotter. Older devices required little space due to their smaller monitors, whereas comparable instruments today are much larger. It may therefore be necessary to cut a larger recess in the GRP or to prepare a completely new space for the installation of the device.

Even undamaged parts are replaced. Example: One of an older pair of genoa winches is destroyed by an insured risk. Both winches are then replaced.

So the difference lies in the details. A precise comparison of insurance offers is hard work, but may pay off in the end. If you want to order quotes from over 20 providers at the click of a mouse and compare them at home in peace and quiet, you'll get to Click here for our free quote enquiry.