Fog Dog wrote:
For the last 15 years or so I have entertained customer's and fellow
employees on my boat. I have recently decided to take a trip from the
Chesapeake to NYC and my company has offered to cover the fuel expense
if I were to make myself and the boat available for employee and
customer outings while there.

In the past I have asked my insurance providers if I would be covered
under these circumstances. They always indicated that provided that I
was not a charter and I made no profit from the expense reimbursement I
would be covered.

I have just been told by a Boat U.S. insurance underwriter that if I
were reimbursed by the company for fuel expense only that this is
considered business use and I would not be covered.

I know literally scores of people who do this regularly and have done
so for years. My question is:

Can this be correct? Are there other insurance companies that have a
more realistic definition of business use? Are there any suggestions
for getting around this?


Odds are probably 99 in a 100 that you could "get away" with doing
this, but should that other 1% come up I think you would be screwed in
a major way. You won't need your insurance unless something happens-
but in this age of exorbitant and punitive legal judgments your
insurance company has a perfectly legitimate and valid "out" in this
situation. Of course, if something happens you could lie like a rug and
hope the investigators don't look too hard at the situation- but once
again if there are hundreds of thousands or even millions of dollars
involved you can be pretty sure the insurance company is going to look
at the situation *very* carefully.

Essential facts: Your *employer* (double red flag) is going to
reimburse you for expenses (iow: compensate you) if you will make your
boat available when and where they specify. Your employer will expect
you to take people who may or may not be known to you for sightseeing
tours or other sorts of boatrides. (This is a lot different situation
than you inviting one of your personal clients out on your boat at a
time and under circumstances of your own choosing and without
compensation).

If you aren't licensed for a minimum of OUPV then insurance is a moot
point- you're operating illegally if you take passengers for
compensation of any kind. In fact, you can't even accept charitable
donations in exchange for a boat ride unless you are licensed. The
determining questions: "Would you have taken Mr. and Mrs. Plaintiff for
a boat ride on that afternoon if they had *not* agreed in advance to
pay $XXX to the American XYZ Association for the privilege?" and (to
Mr. and Mrs. Plaintiff) "Would you have any reason to expect that the
soon-to-be-thoroughly screwed defendant would have invited you aboard
his boat for any reason *except* in response to your donation to the
XYZ Association?" Unless you can make a believable case that the answer
would be "yes", you're accepting compensation for your services and the
fact that you're passing the right of collection off to a third party
is of no consequence.

I'd expect the company to provide the liabilty insurance, and it's
unlikely that they will find anybody to write it unless you're
licensed.