How to Buy a Used Boat

by Kanopy Insurance


To the uninitiated or skeptics among us, a boat is: “a hole in the water you throw money into.” Between dock fees, boat insurance, maintenance costs, and the price of the boat, it can certainly feel like that.

Boating is not an inexpensive hobby. But for those who feel the call of the open water, spending summer days fishing or snorkeling or just sunbathing on the deck, a boat is worth every penny.

Buying a used boat can reduce some of your upfront and ongoing costs. For instance, if you pay cash, you won't have to worry about a monthly loan payment. You also may be able to reduce the costs of boat insurance by taking out a liability policy instead of one with comprehensive coverage. Because a used boat costs less, your premium will also be lower.

But if you don't choose your used boat carefully, you could wind up spending lots more than you bargained for—on both watercraft insurance and boat repairs.

Follow these guidelines to find the perfect used boat for you, your family and friends to enjoy the boating lifestyle without going broke.


5 Tips for Buying a Used Boat

1. Determine what type of boat you want.

Will you be cruising on the lake or fishing in the ocean? Do you feel the need for speed? Or do you want a party boat where friends and family can gather every weekend? Keep in mind, the type of boat you choose will likely affect the costs of boat insurance. Freshwater boats usually cost less to insure than those of a comparable size used in saltwater. The larger the boat, the more it will cost to insure.

Yacht insurance for boats greater than 27 feet costs more than regular boat insurance. Yacht insurance provides “agreed value” protection, which means the full agreed-upon value of the vessel at the time of purchase will be paid, without depreciation, if the boat is totaled. A yacht policy also includes replacement cost coverage for partial losses.

You can purchase an agreed value policy for a watercraft smaller than 27 feet, but premiums will be higher than buying an "actual cost value" boat insurance policy, which covers the value of the boat at the time of purchase minus depreciation.

You can save money on boat insurance by selecting a smaller boat stacked with safety features. The safer the boat, the less it will cost to insure. However, you also need to find a vessel that will make you happy. Balance the costs of ownership, including watercraft insurance premiums, with the type of boating experience you desire.

2. Decide where you want to buy your boat.

You can buy a used boat from a dealer, who will often have trade-in models for sale. You can buy from a broker, who has reduced overhead costs to give you a better deal. With a broker or dealer, you won’t have to visit people’s homes or answer Craigslist ads, which reduces the hassle. Buying from a private seller may carry more risk but could, ultimately, give you the best deal on a used boat.

Experts recommend looking for a boat that is just a few years old, purchased from a reputable dealer, with only one previous owner. But maybe you want to browse ads and scope out your options through all three types of sellers before making your decision. Either way, you’ll want to know the questions to ask when you purchase a used boat.


3. Know what to look for when you shop for a used boat.

It's important to do a stem-to-stern inspection before you buy a used boat. Investigate the following, as problems in these areas, could indicate signs of neglect.

  • Look for cracks longer than 2 inches in the fiberglass, which could hint at larger problems
  • Check the hull’s gel-coat for dull spots or discolorationInspect the overall condition of the hull
  • Look for signs of flexing, cracking or mold and mildew in the wood or fiberglass
  • Loose seats could signal a rotting floor — or merely loose bolts your marine mechanic can fix
  • Look for cracked or worn alternator and steering belts
  • Inspect the condition of safety features, including lifeboats and life vests
  • Ensure the bulkheads are secureLook at the condition of the oil; gritty oil could indicate serious engine wear

Ensure the onboard electronics and the motor work before moving on to the next step.

4. Take it for a sea trial.

Just as you wouldn’t buy a used car without taking it for a test drive, take the boat out for a sea trial. The sea trial gives you a chance to discover how the boat performs, while also uncovering any potential problems you may not have seen on land. By spending a day boating with the original owner, you can also gain insight into his personality and whether or not you can trust buying a boat from him.

5. Have a marine professional inspect the boat.

Still unsure about the purchase? A marine surveyor can check the boat, investigating areas you didn't even consider. At the very least, perhaps you can ask a friend who is a boat mechanic to evaluate the motor for you.

Congratulations, Boat Owner

If the inspection goes well, it could be time to seal the deal and become a boat owner. A used boat can cost less to insure than a brand new model if you make the right choice. A boat in good condition is perceived as less risky than the similar boat with multiple owners and visible signs of neglect. Keeping your boat in good condition will reduce the chances of an insurance claim, which can also help keep your premiums low.

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