SPRING 2015 | MARINE TECHNICIANTODAY
11
Y
our new marine service business
is up and running, your business
cards arrived from the printer and
your name is plastered all over your new
pick-up truck. The tool guy just left with
$2,000 dollars of your savings, and now
it’s finally time to go out and make some
money in your new profession.
Hold on, wait one minute. What did the
marina owner on the other side of town
tell you he needed before you work at his
yard? His letter requested “A Certificate of
Insurance showing proof of General Liability
coverage from an A-rated insurance carrier
for bodily injury and property damage
arising out of your business operations,
including completed operations, and MOLL
with a limit of no less than $500,000,
business auto liability coverage of
$500,000 and Workers Compensation, per
statute, including USL&H with Bumbershoot
coverage at a limit of $1million.”
What, you ask yourself, does all that mean?
You can replace the fuel injection system
on an outboard with a blindfold on but you
aren’t a third year law student!
No worries. You call your insurance guy
who has insured your truck since you were
16. He reviews the request from the marina
and informs you that he thinks a MOLL is
a small rodent and that a Bumbershoot is
some new trendy vegetable. A few words of
advice here: thank him for his time, hang up
and call a marine insurance agent. You need
a specialist for your business insurance.
Let’s take these insurance terms one at a
time. First and foremost is “General Liability
Insurance”. This insurance policy is fairly
similar across all businesses and protects
you, the insured, from lawsuits alleging
‘bodily injury’ and ‘property damage’ arising
out of your negligence in the course of your
business operations. For example, while
working on a boat ashore you tip over a tool
box which lands on the head of a gentleman
walking to his boat. He incurs ‘bodily injury’
caused by your negligence and he sues you.
General Liability insurance would respond
to this lawsuit, pay for your legal defense
and pay any covered judgment against you.
Within this General Liability policy you also
want to include ‘Completed Operations’
coverage. This could be your greatest
exposure to a lawsuit and financial loss.
Once again, an example to illustrate: After
completing a fuel line replacement on an
outboard you leave the job and head back to
the shop. A month later a man in a suit visits
and presents you with a court summons.
You find out that the boat you worked on
burst into flames (along with a good piece
of the dock) when the owner started the
engine for the first time. In this case, your
‘completed operations’ caused ‘property
damage’ arising out of your negligent work.
Your General Liability completed operations
insurance would respond to this lawsuit,
pay for your legal defense and also pay
any covered damages up to the applicable
policy limits.
The other insurance to be aware of is
“MOLL”, or Marina Operators Legal Liability.
MOLL fills in a coverage exclusion found
in the General Liability policy discussed
above. The exclusion states that the policy
will not insure property in your “care,
custody or control”. A lawyer would call
that a ‘bailment’. It is the same thing as
handing your car keys to a valet attendant
or dropping your leather coat off at the
dry cleaner. When you take control of
someone’s property you become legally
liable for damage to that property. The
valet is responsible for your car, the dry
cleaner is responsible for your coat and
you are responsible for your customer’s
boat while you have custody or control of
the boat. (Note: You don’t have to take the
boat with you to be in ‘control’ of it. Simply
working on board could place the boat in
your ‘control’.) MOLL provides you this
added insurance protection and is sold only
by insurance companies that specialize
in marine insurance. If you store, haul,
test drive or repair boats you need MOLL
to be fully protected. For those of you just
doing repairs, MOLL is often called Ship
Repairer’s Legal Liability, but it achieves
the same goal. DO NOT buy Garage Keeper’s
Legal Liability. That is, unless you are fixing
cars. We see that mistake often, and we
know that a boat is not a car.
So what about those other insurance
requirements? Tune in next issue for more
insurance related topics.
James Kay, CIC, CRM is President of Stafford
& Co Insurance, the endorsed Insurance
Professionals for AMTECH. Reach them at
By James Kay, CIC, CRM
Marine Insurance 101:
A Primer Redux
COVER YOUR ASSETS
Welcome to spring AMTECH members!
To launch spring (and save myself some time for our spring marine insurance
renewal season) I am repeating our Insurance 101 article from the first
edition of AMTECH Marine Technician Today. This will provide everyone a good
insurance overview as you dust off your insurance policies for a new season.
In the meantime, feel free to reach out to us with any insurance related
questions at
. Have a great season and please
keep an eye out for our upcoming insurance survey in your mailbox!
