Insurance cover for boats and contamination incidents

Would you be insured if your boat caused a contamination incident on the water?

Boats at a mooring in Norfolk

Promoting and advising boat owners on environmentally sustainable and responsible boating is a commitment that the RYA strives to achieve. From a boat owner’s prospective, it is important to be aware of the actions which we can all do to minimise the environmental impact of our activity on our coastal and inland waterways, especially when it comes to water pollution (see The Green Blue for further details).

Boat owners should be aware of the possible consequences if their boat causes a contamination issue through a leakage of oil or diesel. Some marine insurance policies may not cover a claim for clean-up costs, which can run into thousands of pounds and leave the boat owner liable out of their own pocket.

Will I be covered by my marine insurance policy?

The average marine insurance policy usually excludes losses for this type of claim but may have some limited exceptions as to when a claim will be accepted (which is discussed further below). Other policies may place a condition that there needs to be damage to the boat caused by the leak or spill as part of the claim, which sometimes may not be the case. Others will exclude the type of risk entirely and offer a dedicated environmental liability policy at an added cost.

What are the limited exceptions?

The limited exceptions to have a successful claim for this type of incident are commonly cited in marine policies as when a boat with a robust maintenance regime suffers a sudden and unforeseen leak of contaminate because of a part failure. There are conditions around whether this part is subject to a regular change programme or an annual inspection programme. A successful claim for a policyholder would rest on evidencing that the facts fit on a case-by-case basis.

Next steps…

The RYA recommend that boat owners check their policy wording carefully and if in any doubt ask your insurer or broker to clarify the position for you. Boat owners need to be aware of the risk of any such incident - any uninsured loss may give rise to costly litigation.

RYA Legal Team
01 September 2022