One of the most common questions we hear from boat owners is simple:
“Do I legally have to carry boat insurance?”
That’s an important question, but it isn’t necessarily the most important one.
There’s a big difference between carrying the minimum insurance required by law and carrying enough insurance to make a serious boating accident a manageable financial event instead of a threat to your savings, income, home, or other assets.
The legal requirements are also different in Missouri and Arkansas. Missouri generally does not require recreational boat owners to carry boat insurance simply to operate a boat, while Arkansas requires liability insurance on certain motorboats and personal watercraft. Arkansas currently requires at least $50,000 of liability coverage per occurrence on motorboats with more than 50 horsepower and personal watercraft.
But whether the law requires insurance shouldn’t be the end of the conversation.
If you’re looking for information about the different coverages available for your boat, visit our Boat Insurance in Missouri & Arkansas page.
Is Boat Insurance Required in Missouri?
For most recreational boats, Missouri does not have a statewide requirement that you purchase boat insurance simply to operate your boat.
However, that doesn’t necessarily mean nobody can require you to have it. A lender may require insurance if you’re financing your boat, and a marina or storage facility may have its own insurance requirements.
More importantly, not being required to carry insurance doesn’t eliminate your financial responsibility if you cause an accident.
If you’re responsible for seriously injuring another person or damaging someone else’s boat or property, the fact that Missouri didn’t require you to purchase insurance isn’t going to make that financial liability disappear.
That’s why we think boat owners should ask two separate questions:
“What insurance am I legally required to carry?”
and
“What insurance would be prudent to carry to protect my family and assets?”
Those questions can have very different answers.
Is Boat Insurance Required in Arkansas?
Arkansas has a more specific boat insurance requirement.
Arkansas law requires liability insurance for motorboats equipped with engines greater than 50 horsepower and personal watercraft. The law requires at least $50,000 of liability coverage per occurrence.
That’s the legal requirement.
It doesn’t necessarily tell you how much liability insurance is appropriate for your financial situation.
A serious boating accident involving multiple passengers, another boat, a dock, a swimmer, or significant bodily injuries could potentially result in damages well beyond a minimum liability limit.
Meeting the minimum requirement can make you compliant with the law.
It doesn’t necessarily mean you’re adequately protected.
Legal Minimum vs. Safe and Prudent Coverage
Insurance laws establish minimum standards. They aren’t necessarily recommendations for how much protection your family should purchase.
Think about some of the things that could happen in a serious boating accident.
You could collide with another boat. A passenger could suffer a significant injury. You could hit a swimmer or skier. You could damage a dock or another person’s expensive watercraft.
If you’re legally responsible for a covered accident, your boat liability insurance can become one of the most important parts of your financial protection.
A serious claim can involve medical expenses, lost income, property damage, legal expenses, and potentially significant damages following a serious or permanent injury.
If your insurance isn’t sufficient to address a covered liability claim, your personal assets may become part of the financial equation.
That’s why we encourage boat owners to select liability limits based not only on what they’re legally required to carry, but also on what they’re trying to protect.
You Don’t Necessarily Have to Insure the Boat Itself
This is something many boat owners don’t realize.
Depending on the insurance carrier, boat, and policy, you may be able to purchase liability protection without purchasing comprehensive and collision coverage for the boat itself.
This can be particularly useful if you own an older or lower-value boat and are comfortable assuming the risk of damage to the boat.
For example, you might own a $5,000 fishing boat and decide:
“If something happens to my boat, I can afford to replace it. What I can’t afford is causing an accident that seriously injures someone.”
Depending on the insurance carrier and eligibility, you may be able to purchase a policy providing:
- Boat liability coverage
- Boater Uninsured Motorist coverage (BUM)
- Boater Underinsured Motorist coverage (BUIM)
without purchasing physical damage coverage on the boat itself.
Because you’re choosing to retain the risk of damage to your own boat, liability-focused coverage can often be relatively affordable, depending on the boat, operator, coverage limits, location, insurer, and other underwriting factors.
Essentially, you’re choosing to self-insure the value of the boat while transferring potentially much larger liability and bodily-injury risks to an insurance company.
That’s a very different decision from simply saying, “My boat isn’t worth much, so I don’t need insurance.”
What Does Boat Liability Insurance Protect?
Boat liability insurance is designed to help protect you when you’re legally responsible for a covered boating accident.
Depending on your policy, this can include claims involving bodily injury to other people and damage to someone else’s property, along with applicable legal defense subject to the terms and conditions of the policy.
The Missouri Department of Commerce & Insurance describes watercraft insurance as coverage that can address both the watercraft itself and liability arising from its ownership, maintenance, or use.
The key point is this:
Liability insurance isn’t primarily about protecting your boat. It’s about protecting you.
If you own a home, have savings, investments, income, or other assets, your liability coverage can be one of the most important parts of your boat insurance policy.
You can learn more about liability, physical damage, towing, equipment, trailer coverage, and other available options on our Missouri & Arkansas Boat Insurance page.
What Are BUM and BUIM Coverage?
Protecting yourself from accidents you cause is only half of the insurance conversation.
You also need to consider what happens when someone else causes the accident.
Boater Uninsured Motorist (BUM) coverage may provide protection for covered bodily injuries when you’re injured by an at-fault boater who doesn’t have applicable liability insurance.
Boater Underinsured Motorist (BUIM) coverage may provide protection when the at-fault boater has liability insurance, but the available limits aren’t sufficient to address your covered bodily injury damages.
Insurance companies may use different terminology for these coverages, and availability, limits, exclusions, and exactly how the coverage works can vary by insurer and policy.
That’s why BUM and BUIM should be specifically discussed when you’re comparing boat insurance.
Why BUM and BUIM Can Be So Important
Imagine you’re spending the afternoon on the lake with your spouse and children when another boat operator causes a serious collision.
Members of your family are injured.
Then you discover the other boater doesn’t have insurance.
The other operator may still be legally responsible for the accident, but being legally responsible and having the financial resources to pay for the damages are two very different things.
That’s where your own insurance can become extremely important.
Now consider a slightly different scenario.
The other boater has insurance, but carries a relatively low liability limit. Your family’s injuries and other covered damages significantly exceed the amount available from that person’s policy.
Depending on your policy and the circumstances, BUIM coverage may provide additional protection when the at-fault boater’s insurance isn’t sufficient.
BUM and BUIM aren’t primarily about protecting the fiberglass, motor, or trailer.
They’re about protecting the people sitting in the boat.
That’s why someone who decides they don’t need comprehensive or collision coverage on an inexpensive boat may still have a very good reason to carry liability, BUM, and BUIM coverage.
Protect the Boat—or Protect the Family?
Boat owners understandably spend a lot of time thinking about the value of their boat.
A pontoon, bass boat, wake boat, or fishing boat can represent a substantial investment.
But consider two very different losses.
Loss #1: Your boat is destroyed and needs to be replaced.
Loss #2: You, your spouse, or your child suffers a serious injury because of an uninsured or underinsured boater.
For many families, the financial consequences of the second scenario could be substantially greater than losing the boat.
That’s why the value of the boat shouldn’t be the only consideration when deciding whether insurance is worthwhile.
What If My Boat Isn’t Worth Very Much?
An older boat is actually a great example of why it’s important to separate physical damage protection from liability and injury protection.
Suppose you own an older fishing boat that’s completely paid for.
You may decide that comprehensive and collision coverage aren’t worth purchasing because you could financially absorb the loss if your boat were damaged or destroyed.
That can be a reasonable risk-management decision.
But the value of your boat has very little to do with the amount of damage you could cause someone else.
A relatively inexpensive boat can still cause an extremely expensive accident.
So instead of asking:
“Is my boat worth enough to insure?”
A better question may be:
“Is the liability and bodily injury exposure worth insuring?”
Those are two very different questions.
What About Passengers on My Boat?
This is another reason we encourage boat owners to think beyond the value of the boat itself.
Your spouse, children, friends, and other guests may regularly ride with you.
If they’re injured in an accident caused by another boater who doesn’t have adequate insurance, the coverage available under your own policy could become extremely important.
When comparing boat insurance, don’t only ask:
“What happens if my boat is damaged?”
Also ask:
“What happens if my family is seriously injured by someone who doesn’t have enough insurance?”
That’s where understanding your BUM and BUIM coverage becomes important.
Should Boat Owners Consider an Umbrella Policy?
Boat owners with a home, savings, investments, higher income, or other significant assets should also discuss a personal umbrella policy with their insurance agent.
An umbrella policy may provide additional liability protection above an eligible underlying boat policy, subject to the umbrella carrier’s requirements, exclusions, and policy terms.
Not every boat or watercraft automatically qualifies, and the underlying boat policy may need to carry certain minimum liability limits.
This can be especially important for people with larger or higher-horsepower boats, those who frequently carry passengers, and households with significant assets to protect.
So, Do I Need Boat Insurance?
The legal answer depends partly on where you live and what you operate.
In Missouri, most recreational boat owners aren’t subject to a general statewide boat-insurance requirement simply to operate a boat.
In Arkansas, liability insurance is required for motorboats with engines greater than 50 horsepower and personal watercraft, with at least $50,000 of liability coverage per occurrence.
But we don’t think the conversation should stop with what’s legally required.
Legal requirements establish a minimum. Safe and prudent insurance decisions should consider what you’re actually trying to protect.
For some boat owners, that means comprehensive coverage on an expensive boat.
For others, particularly those with older or inexpensive boats, it may mean choosing to self-insure the boat itself while purchasing liability, BUM, and BUIM coverage to protect against potentially much larger financial risks.
The goal isn’t necessarily to buy every coverage available.
The goal is to understand the risks you’re keeping and the risks you’re transferring to an insurance company—and make that decision intentionally.
MBG Insurance works with boat owners throughout Missouri and Arkansas and can compare options from multiple insurance companies. Visit our Boat Insurance in Missouri & Arkansas page to learn more about available coverage or request a quote.