With all of the snow that we had this past weekend and are projected to get for the rest of the week, how could we not talk about snowmobiles.  I’m sure some people may have even given or received a snowmobile as a gift this past holiday season. 

I know my neighbor received a snowmobile for Christmas, I could tell by all of the tracks in his front yard.  Good thing he received a trailer to haul his snowmobile because I don’t think he’ll get his riding fix on our city sized lot.  So that brings up the questions of insurance and registration, if he is going to take his snow mobile off of his property what does he need to do?

NYS says that if you plan to ride your snowmobile on your own private property or someone elses that you have express permission to ride on you are not required to register your snowmobile with the DMV.  But if you are planning to ride on public trails you do need to register your snow mobile with the DMV and pay a $100 fee.  Now if you are a Snowmobile Club Member your registration fee is only $45.  You can find a local club to join at http://www.snowmobilingusa.com/Snowmobile_Clubs.htm. 

Surprisingly, the DMV doesn’t require snowmobilers to carry insurance.  This opens riders up to a huge risk because if you are injured by another rider most likely they won’t have insurance to cover your medical bills and you won’t have any insurance to cover them yourself.  Snowmobile insurance policies are similar to motorcycle policies in the fact that they don’t automoatically provide any medical coverage to the rider, it needs to be selected and you pay an additional premium for it. 

Now you can insure your snowmobile relatively inexpensively by adding them to your homeowners or auto insurance and these will provide you with limited liability coverage in case you injure someone else.  You can even insure your sled for any physical damage caused by an accident.  Adding your snowmobile to your auto or homeowners insurance is better than having no insurance at all, but we recommend purchasing a separate snowmobile insurance policy.  It is a little more expense, but the coverage it provides you is better because you can select medical coverage to help pay for your hospital bills if you are injured while riding.

Most homeowners’ insurance policies provide limited coverage for boats.  If you boat is less than 75 horse power or less than 26 feet for sail boats, your homeowners policy will provide liability coverage.  Also most homeowners’ policies will provide $1,000 to $2,000 of coverage for your boat for only certain types of claims, such as, catching on fire, windstorm, hail, explosion, vandalism, theft, just to name a few. 

Your best bet is to get a separate boat insurance policy.  This will provide you much better coverage than your homeowners’ policy.  A boat policy will provide you with the appropriate liability, hull and motor coverage and you will be able to insure the boat for its full value.

You have to be careful when shopping for boat insurance because the policies can vary greatly.  You may think you are getting a great deal but the coverage could be drastically different from another policy.  The big coverage to watch out for is how the insurance company is going to settle your claim if you have a total loss, are they going to pay the agreed value of the boat or only the actual cash value. 

Agreed value means that if you purchase your boat for $20,000 and you and the insurance company agree to insure it for that amount, then, if you have a total loss five years down the road, the insurance company will pay up to $20,000 to replace your boat with a similar boat.

Actual cash value means that if you purchase your boat for $20,000 and you have a total loss five years down the road, the insurance company is going to apply depreciation to your boat.  You may find yourself in a situation where you may only receive $12-$15,000 to replace your boat.  That might mean that you would have to down grade to a smaller less powerful boat, unless you wanted to pay the additional $5-$8,000 out of your own pocket to replace your damaged boat with a similar one. 

The agreed value policy will cost you a more up front, but could potential save you thousands of dollars in the long run.

I recently had a claim from a client that damaged his snow mobile while he was out riding.  His track ended up breaking, which damaged a number of the components in his engine.  At first glance he didn’t think that the damage was significant.  He was even considering not submitting a claim.  That changed after he took the sled to the dealership for an estimate. 

The dealer said that it would cost $2,700 to fix his sled and it was pretty close to be totaled.  My client was worried that if they totaled the sled that he wouldn’t have enough money to buy a new one or fix his current one.  Even though, I’m looking forward to spring, I know some of you are looking forward to at least one more snow fall.   

So how would the insurance company settle this claim?  The insurance company has the option to take the less expensive of the two options.  They can opt to repair the snow mobile if it is less expensive than the market value of the sled or if the repairs are greater than the market value of the snow mobile he would be paid the market value of the sled as determined by the insurance company.  Either way he is still going to be able to ride for the rest of the winter. 

If the insurance company opted to total the snow mobile he wouldn’t be able to go out and purchase a brand new sled, but he would be able to buy a comparable sled to what he has now.   

I assured him that he wouldn’t be left out in the cold without a snow mobile, that the company would settle it fairly and quickly, which they did.