In the high-net-worth stratosphere, owning four autos is not unusual. What is unusual is owning four different types of boats under three different ownership entities (personal, corporate and LLC), docking them in three locations (Florida, Montana and the Bahamas) and flagging them in two different countries (U.S. and the Cayman Islands).
In this case, the agent placed the client’s business, homes and autos without difficulty. But the boats were another matter. Loath to put the account at risk by involving another retail agency in placing them, he approached Burns & Wilcox, recounts senior underwriter Erin Deaton of the Burns & Wilcox Detroit office, who heads the broker’s Marine Center of Excellence.
“Placing the boats was a matter of finding the best fit for each,” she says. “I had to treat them as four separate risks.”
The most complicated boat to place was a $300,000 center-console fishing boat with triple engines, which was owned by the client’s corporation and docked in a southern Florida marina. This popular type of boat can range far offshore and has a tournament fishing pedigree, traits that make it a prime target for theft. Certainly with an absentee owner and no crew to attend to it, the boat posed an even greater theft risk, not to mention a significant hurricane risk.
To make the boat more insurable and less likely to suffer a loss, Deaton worked with the agent to provide and implement an anti-theft plan for the vessel. The client installed a monitored GPS tracking device that would send an alert if the boat were moved without his knowledge and would continue to pinpoint its location. She also had the marina put together a written haul-out plan to place the boat in a covered wind-rated building 72 hours before the expected arrival of a storm. Both plans were part of the original submission.
The most valuable boat was a $2.4 million yacht flagged in the Cayman Islands, kept in the Bahamas and owned by a limited liability company. A 32-foot cruiser owned by the client’s corporation was docked in the same marina and both faced similar crew, theft and hurricane exposure. In this case it was important to have Jones Act coverage for international obligations stemming from any crew member injuries, along with protection and indemnity (PI) and hull coverage. The yacht’s Cayman Island registry was a hurdle for U.S. coverage, and the boats’ Bahamas location added to the challenge.
Simplest to place was a $35,000 fishing boat owned directly by the client and kept at a cabin in Montana. The retail agent didn’t have an available market in that state, so he turned to Burns & Wilcox for this one, too.
All the boats were successfully and seamlessly placed with good markets. How? “Asking the right questions and getting the right information upfront is key with marine risks because it’s very difficult to overcome an initial declination on a submission outside the traditional box,” says Deaton. “Those questions are second nature to us and we add immeasurable value to the transaction.”