What Should I do Before Starting My Own Boat Charter Business?

Sep 21, 2022

Business Insurance

What Should I do Before Starting My Own Boat Charter Business?

Starting your own boat charter business can be a very profitable venture with the right business model and marketing. While it's an exciting idea, what causes many sailing enthusiasts to hesitate to enter this field is the costs of boat ownership. If you can get past the upfront financial hurdle, starting a boat charter service can become the career of your dreams.

What Is a Charter Boat?

A boat charter service is essentially a boat rental service. You make money as a boat owner renting your boat out to customers for a limited time. Another way to earn revenue is to make the boat available for other cruisers to book. This service attracts a broad range of customers who either cannot afford their own boat or prefer riding on a boat charter service.

The steps to starting your own boat charter business are as follows:

  1. Figure out the type of charter to run
  2. List your boat on an online boat rental platform
  3. Purchase commercial boat insurance
  4. Design a detailed listing for your boat or charter
  5. Manage your business on the rental platform

Types of Boat Charters

There are various types of boat charters to consider, depending on how the vessel is used. When a person rents a boat, they take responsibility for it while it's under their control. Some boat charter services provide captains and other necessary provisions.

The two main boat charters are for fishing and luxury yachts. A fishing charter, which typically includes a professional guide, allows someone to spend a few hours with the boat in an attempt to catch fish. Boat renters provide their own fishing gear and supplies. A luxury yacht charter may involve renting a vessel for up to a week in a popular destination. This type of charter usually provides crew members and cooks to prepare meals.

Another type of boat charter is called a "bareboat charter," in which a vessel is rented for a set period of time without a crew or other provisions.

Business Requirements

One of the main requirements by a state is that whoever drives the boat must have a captain's license for carrying passengers. As an owner, your main responsibility is to register the business with the state or local government. 

Understanding Insurance for a Boat Rental Business

A key reason for getting insurance for your boat business is to protect the value of your assets. If a party renting your boat damages it on a journey, the right insurance will pay for repairs.

The cost of boat rental business insurance depends on various factors, such as how the rising number of boat owners impacts the number of claims. Another key factor is the location where the vessel is stored. Regions prone to hurricanes have more expensive insurance costs due to an increased number of claims.

Where the boat travels is another factor that affects insurance costs. Journeys that involve long trips in volatile waters have higher risks and insurance costs than short rides in calm peninsulas. Finally, the boat owner's experience and driving record can affect insurance premiums.

Cover Your Charter Boat Business with Graystone Insurance Group

Finding the right type of boat insurance should be a top priority when starting your own boat charter business. Contact our experts at Graystone Insurance Group to help you find the right plan to protect your vessel.

Also Read: What Factors Decide Premium of Marine Insurance Policies?