Day: May 18, 2018

Did my insurance pay out when I was struck by lightning?

One beautiful Saturday morning in the summer of 2012 I arrived at the marina where I kept my 30 foot sailboat. I assumed everything was as I left it and ready for a great day with the family out on the water. But upon boarding the boat I found all was not right. There were small pieces of metal and other debris peppering the cockpit. The main circuit breaker had been tripped and my navigation electronics are either not turning on or acting “funny”.

It quickly became apparent that I’ve been struck by lightning.

So what happens next? I called over to some slip neighbors to share my predicament. They commiserated. One or two had similar experiences in the past. They tell me my VHF antenna is probably destroyed and I will likely need to replace some internal wiring. (They were right, my VHF antenna turned out to be the strike point and was melted/exploded. That was the metal shards spread all over the topside.)

I was unable to go out that day. Worse, I knew this damage could mean a couple weeks before I’m out on the water again. Later that day I spoke to the marina manager about repairing the damage. He first recommended a haul to check for leaks which I did. In the end the estimate to repair the damage was modest at around $2,000.

I immediately think of my boat insurance. I have the standard policy and a $1,000 deductible. I’ve dutifully paid the premiums on my policy for decades and never had a claim. Finally I have a chance to get something back from insurance as I had a genuine claim. Or so I thought.

The claim process was horrific and slow. From the onset they made me feel uncomfortable – as if I were lying every time we spoke. Asking the same questions over and over, at one point demanding video evidence of the strike itself, and wanting to send an expert to inspect the boat in several weeks!

The boat was repaired and back to normal in about two weeks. I paid the roughly $2,000 out of pocket upfront and expected about $1,000 reimbursement from my insurance (after accounting for the $1,000 deductible).

But the claim adjusting process continued to drag on. One day talking to the yard manager and other boaters they told me to just save myself the hassle, withdraw the claim and eat the $1,000 loss and I’d be better off. But why? I thought. I had a genuine claim. The manager told me that in his experience the insurance may eventually pay the claim but once they did they would use that as an excuse to either cancel my policy or increase my premiums for years to come. In the end it’s just not worth the hassle to get that $1,000 payment. I should save that insurance policy for a larger loss and in the meantime preserve my claims-free status with them because it means lower premium rates.

The logic made sense but I couldn’t believe it. A lightning strike is not my fault, why should I be penalized in the form of higher premiums Lightning is the very legal definition of “an act of God”. What justification would an insurance company have to cancel me or increase my premium for an act of God?

After a couple more weeks of hassle and no payment I eventually heeded the advice and withdrew my claim in frustration. Sure enough, I received a letter from the insurance company thanking me for withdrawing the claim and saying that “now they will not have to increase my premium because my claims free record is untarnished”. This whole experience rubbed me the wrong way regarding insurance companies. What good is insurance if they want to punish you for using it when you have a genuine claim?

I’ve shared this story with others in the marina that summer and the years since. I’ve heard at least a dozen people tell me similar stories with lightning related claims on their boats and similar experiences with boat insurance companies. As it turns out, lightning strikes are a big problem for boaters. The statistics don’t lie. Damage from lightning strikes is a top ten or sometimes top 5 reason for claims brought under boat insurance policies. In rare instances a lightning strike will completely destroy a boat. But the vast majority of the time the damage is less than $10,000 or even $5,000.

It makes sense to have a special insurance policy only for lightning – with an insurance company that will not hassle you for filing a claim and will not increase your rate if you do have a claim. Best of all, it would not report your loss to the traditional carriers so you can maintain your valuable claims free status with them.

That’s why some of us boaters got together to form Mariners Alternative Insurance Services and begin offering our debut product, LightningShield™ – a supplemental insurance policy for boaters.

LightningShield provides $5,000 or $10,000 of Insurance for damage to a boat resulting from a direct or indirect lightning strike. There is no deductible. Our claims process is fast and hassle free. We won’t increase your premium if you have a claim and best of all we won’t tell your traditional boat insurance company about any claims so you can keep a loss free record with them!

I highly recommend you check out how affordable a LightningShield policy can be by clicking that “Get a Quote” button.

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