Question 1

How is P&I different from hull insurance?

Accepted Answer

Hull and machinery (H&M) covers your vessel itself — physical damage, machinery breakdown, total loss. P&I covers what your vessel does to others — crew injuries, passenger claims, pollution, wreck removal, third-party property damage. They're complementary policies typically sold separately. Recreational yacht insurance bundles limited liability (maybe $1M) into the hull policy, but commercial operators need dedicated P&I with limits matched to passenger and crew exposure. Hull and P&I are the two foundational maritime coverages.

Question 2

What is the Jones Act and why does it matter?

Accepted Answer

The Jones Act (Merchant Marine Act of 1920) gives commercial seamen the right to sue their employers for negligence-caused injury or illness — a much broader remedy than state workers' comp, with no cap on damages and the right to a jury trial. Every commercial vessel operator faces Jones Act exposure for anyone who qualifies as a 'seaman' (crew with substantial connection to a vessel in navigation). P&I includes Jones Act crew coverage; without P&I, crew injury claims fall directly on the vessel owner with potentially catastrophic exposure.

Question 3

Does P&I cover passenger injuries?

Accepted Answer

Yes, third-party passenger injury liability is a core P&I coverage. Passenger claims on charter vessels, ferries, dive boats, and other commercial passenger operations all fall under P&I. The Coast Guard limitation of liability principles apply on navigable waters but don't eliminate exposure to modern injury claims — courts have steadily eroded historical limitations. P&I limits should be sized to cover the worst-case passenger injury scenario plus defense costs, which can easily exceed $1M on serious claims.

Question 4

What's pollution coverage under P&I?

Accepted Answer

P&I includes pollution liability for sudden and accidental fuel and oil spills from your vessel, including the costs of cleanup mandated by the Coast Guard, EPA, or state environmental agencies. Florida-specific pollution reporting under the Florida Department of Environmental Protection adds state-level cleanup obligations. P&I pollution coverage typically has its own sublimit; truly catastrophic spills (a fuel barge accident, a vessel sinking with full bunkers) may exceed P&I limits and require separate marine pollution policies.

Question 5

What about wreck removal?

Accepted Answer

If a vessel sinks or grounds in U.S. navigable waters, the federal Wreck Act (33 USC 414-415) typically requires the owner to remove the wreck if it presents a hazard to navigation. Wreck removal costs frequently exceed the vessel's value — recovery, salvage, and disposal can run hundreds of thousands of dollars even on modest vessels. P&I includes wreck removal obligations as a standard coverage line. Without P&I, wreck removal is a direct out-of-pocket obligation.

Question 6

How is P&I priced?

Accepted Answer

P&I premium is driven by vessel type and operations, crew count and operational radius, passenger capacity and itineraries, prior claim history, navigation territory, and selected limits. Florida charter and commercial fishing P&I typically runs $5K–$30K annually for $1M–$5M coverage. Larger commercial vessels (tugs, ferries, supply boats) carry higher limits and pay accordingly. P&I Club mutual membership offers different pricing structures than commercial P&I markets — vessel size and operations dictate which is appropriate.

Question 7

Do I need P&I if I have a Coast Guard-licensed captain?

Accepted Answer

Yes — captain licensing doesn't satisfy the insurance need. Coast Guard licensing confirms the captain's qualifications; P&I insurance covers the financial obligations of commercial operations. They're independent requirements. Most marinas, charter brokers, and event organizers also require proof of P&I (typically $1M+) before allowing commercial vessels to dock or carry passengers. License and insurance work together; neither replaces the other.

Protection & Indemnity (P&I) Insurance

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