Boat and Vessel Title Insurance
Why Do Watercraft Vessels Need Title Insurance?
There several types of problems which can occur on boat titles. Buyers of vessels are usually unaware that any of these problems exist - until they are slapped with an ownership lawsuit or fees associated with prior liens. Insurance agencies hire underwriters and title attorneys to investigate the title's chain of ownership to uncover these problems - and resolve them - before the sale occurs.
Common problems associated with yacht and vessel titles include:
Fraud. Forged or fraudulent documents can occur at any point in ownership history. Vessel brokers or previous owners sometimes attempt to sell vessels under false titles, defrauding both the vessel mortgage lender and the new owner. In some rare cases, the mortgages in the vessel's ownership history may be revealed as fraudulent. Additionally, watercrafts may be registered with both the US Coast Guard and the State, allowing vessels to carry more than one "valid" title. Multiple titles can precipitate multiple mortgages for which the vessel owner can be held responsible.
Ownership disputes. Even though a vessel owner carries a valid Certificate of Documentation and Federal boat registration, he or she may still be subject to ownership disputes. These documents do not have the ultimate authority to determine ownership; only the yacht or vessel's underlying contract can determine ownership. If the vessel title's underlying contract is drafted on fraudulent documents, the buyer's ownership could be rendered void.
Preexisting mortgages or liens. The new owner of a watercraft is held responsible for any unpaid taxes, unresolved mortgages and unpaid contract work associated with a vessel's title, even if he or she was not privy to them at the time of purchase.
Watercraft buyers may ask for a title opinion before finalizing the sale. While a good opinion provides some assurance against disputes, vessel title opinions and abstracts may not always be reliable. Erroneous records, improper documentation, fraud and human error can lead underwriters to draft faulty title opinions. The only way for the buyer of a yacht or boat to protect him or herself against these complications is to purchase vessel title insurance.
How Does Boat Title Insurance Protect Me?
In addition to performing a thorough investigation of the vessel's ownership history before the sale is complete, title insurance companies provide financial compensation in the event of a lawsuit. Vessel title insurance typically covers the cost of legal defense against attacks on the vessel's title; additionally, insurance will provide compensation for any financial or asset losses caused by a faulty title.
Learn more about vessel title insurance by visiting the watercraft and yacht title insurance specialists at Sun Title Agency. As one of the US' only specialists in vessel title insurance, Sun Title Agency offers expert title insurance services for yachts, boats and all watercrafts 20 feet or larger.
If you're investing in a watercraft vessel or boat, contact Sun Title Agency to learn more about how title insurance can protect you. At costs often as low as 1% of the purchase price, Sun Title Agency's vessel and watercraft title experts will ensure your new purchase is protected from legal title disputes.