Important Changes to Cowan’s Pleasure Craft Program

June 10, 2019

Cowan Insurance Group has partnered with CPS-ECP for over 25 years to offer pleasure craft insurance to its members. While we have always been able to provide rate stability, deteriorating results across the country have impacted those rates. As such, our previous program partner opted to reduce their marine exposure, leading us to select a new one.

Welcome aboard!

Effective May 1, 2019, we began working with our new program partner. Following conversations with six potential markets, we selected the one that met the following requirements of our program:

• Provides national coverage in both official languages.

• Includes coverage for both saltwater and inland navigation.

• Recognizes the importance of our relationship with CPS-ECP and is prepared to work with us to improve member benefits.

Why are premiums increasing?

In the past two years, we have seen the frequency and severity of claims increase—a combination of inexperienced operators, weather-related events, and changing guidelines and program eligibility. As a result, there has been a negative impact on the pleasure craft market and thus, the profitability of the program. Over the past year, we have seen:

• Increasing rates and deductibles (up to 30% in some regions)

• Claims costs impacted by higher repair costs

• Insurers exiting the pleasure craft insurance market or opting only to insure boats operated in inland waters

• Changes to coverage for southern navigation and a reluctance to provide named storm coverage

• Tightened eligibility and underwriting guidelines, as insurers attempt to rid their books of unprofitable classes (e.g., older vessels, wooden hulls, high-performance boats, inexperienced operators)

Weather-related claims are on the rise, especially in some areas of BC where vessels are not laid up during the winter months. Examples of these include:

• In both BC and Ontario, snow loads have caused vessels to sink in their slips and boat shed roofs to collapse onto boats.

• Vessels sinking in their slips after taking on water because of power outages or a non-functioning bilge pump due to dead batteries

• Damages to both vessels and piers from strong winds across Canada. In particular, the storm in White Rock, BC in December 2018, which caused millions of dollars in damages.

• Severe wind storms causing docks or cleats to break away and vessels to drift because of poor marina maintenance.

• High water levels in Ontario and Quebec, resulting in increased collisions with rocks in the past couple of years.

If you’re concerned about your premiums, please contact us to ensure you understand your full range of options and that you have the appropriate coverage for your needs. We look forward to working with our new program partner over the next three months to strengthen Cowan’s pleasure craft program and provide more value to participating CPS-ECP members.

To contact the CPS-ECP team at Cowan, please email programs@cowangroup.ca.

Story submitted by Cowan Insurance Group.