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Is your yacht a floating liability?

The captain had given the yacht’s chef a day off, and all was well—a swim, a trip down the slide, a tender ride—until it wasn’t. While riding an e-foil, the chef reached down blindly and lost a finger in the propeller, an accident that would have a lifelong impact on his livelihood. Incidents like these are a reminder that even routine moments onboard can quickly become serious liabilities for yacht owners. Beyond the lifestyle and enjoyment that come with ocean travel, luxury yachts carry significant financial, legal, and operational exposures that are often underestimated. Here, our dedicated experts, who develop insurance programs for some of the world’s largest vessels, lay out all the relevant financial, legal, and operational liabilities and how to mitigate the associated losses. The top five most common liabilities: 1. Crew injuries. Crew members work, eat, and sleep onboard, increasing an owner's liability exposure, particularly on heavily staffed vessels. Watersports injuries, line handling, galley accidents, and other high-risk conditions are common sources of injury. Under U.S. maritime law, including the Jones Act and the doctrine of maintenance and cure, vessel owners may be responsible for an injured crew member’s medical care, lost wages, lodging, food, and recovery expenses. Similar obligations may also arise under applicable international maritime and employment laws. 2. Guest injuries. Once guests come aboard, injuries sustained during the trip become a liability matter for the owner. Tender transfers, personal watercraft, diving excursions, wet decks, and dockside boarding incidents are among the most common sources of guest-related claims. 3. Collision and dock damage. Navigating a yacht into a tight slip is an art, and with an unexpected tide and wind change, the captain can swerve into another boat or the dock. Even experienced crews can misjudge tight quarters, and collisions with moored yachts are a common risk when departing crowded or unfamiliar marinas. 4. Shipyard exposure. In a concentrated work area, a single incident—like the spark from a welder’s equipment—can ignite a destructive chain reaction. Shipyards often carry limited liability coverage—an exposure that can become glaringly inadequate when a single incident damages several multi-million-dollar vessels at once. Shipyards also may ask owners to waive rights of subrogation, limiting a carrier’s ability to seek reimbursement from responsible third parties after paying a claim—a request that requires negotiation with carriers. 5. Environmental and pollution liability. Equipment failure, protocol violations, and improper waste management can lead to spills that damage protected reefs and marine life. In one instance, a small vessel pulled away from the dock with a fuel nozzle still attached, resulting in a serious issue. Even a seemingly minor oil leak can result in fines and penalties, often assessed without limitation, in addition to cleanup costs and potential criminal exposure. Four steps to mitigate liability 1. Treat the yacht like a business. Unlike sports cars, which are taken on weekend drives and then safely stored in a garage, yachts operate as full-time assets with daily operational, liability, and personnel exposures. Owners should ensure captains and crew are properly certified, background-checked, and continuously trained. Detailed maintenance records, vendor documentation, and operational logs should be maintained to support claims, satisfy underwriting expectations, and protect resale value. A proactive approach can materially reduce risk while enhancing the vessel’s long-term performance and insurability. 2. Structure ownership through an LLC or LTD. Set up a dedicated legal entity to own the vessel. This creates a layer of separation between the owner's personal assets and yacht-associated liabilities. Though it won’t prevent lawsuits, it will limit how far a plaintiff can reach your broader estate. 3. Obtain proper protection with a layered insurance program. A protection and indemnity (P&I) policy is the primary shield against liability claims and should at least cover the boat’s value. A comprehensive program should also include hull and machinery coverage for the physical structure, tenders, toys, and fixed furnishings; crew medical; charter liability; and uninsured boater coverage. High-profile owners might also consider cyber risk, kidnap and ransom (K&R), and hired and non-owned auto coverage. Note: Unlike with auto insurance, where a loss affects rates for up to five years, losses related to yachts follow owners indefinitely. 4. Consult the proper advisors. Maritime attorneys, yacht insurance specialists, yacht managers, and safety management companies each bring a particular and necessary expertise. Trusted advisors should review each contract, ensure compliance with flag state requirements, and structure a thoughtful program that provides the best insulation against potential issues. In the end, protecting a yacht owner from liability is nearly as complex as the inner workings of the ship itself. Fortunately, our experts are quite familiar with both. ...

Is your luxury home vulnerable?

Benjamin Franklin famously said, "An ounce of prevention is worth a pound of cure." As the founder of one of America’s first property insurance companies, Franklin understood that small actions today can help prevent significant problems tomorrow. That principle remains just as relevant today, especially in a challenging insurance market where luxury homeowners face increasing restrictions from carriers, proactive maintenance and loss prevention can help high-value homeowners protect their property and avoid costly surprises. Our loss control experts regularly work with high-value homeowners to identify maintenance issues that could increase likelihood of a loss. Here’s what they suggest you look for: Five exterior warning signs to watch for: 1. Wear and tear: Peeling paint and cracks in siding and stucco indicate the intrusion of moisture. Soft, expanding, or “bubbling” wood in a soffit or around windows or trim may mean dry rot. 2. Damaged or missing roof shingles: These often lead to water damage because they create vulnerabilities in the roof’s underlying waterproofing layer. If carriers determine that the damage could have been avoided with proper attention, they may invoke a maintenance clause and deny claims. A roof in disarray is a red flag to a claims adjuster. 3. Doors and windows that don’t operate correctly: They could be signs that your house is settling, and its foundation needs attention. Additional indicators include cracks in stucco, brick points, or the foundation itself. You can check clogged gutters to make sure they are not a contributing cause, as water that isn’t channeled away from the house tends to settle in corners. 4. Overflowing gutters and drains: Similarly, when gutters don’t drain properly, water can reroute under flashing, through basement windows, and to other areas that will quickly succumb to costly insurance losses. 5. Rusty water heaters and plumbing fittings with white crust: These important indicators can develop gradually and are easy to miss without periodically checking mechanical rooms. Four interior warning signs that can trigger claims: 1. Imperfections on interiors: Stains on paint and cracks in walls, especially above doorways, suggest leaks or that the house is settling. 2. Higher-than-expected utility bills: A drafty window can make heating and air conditioning units work harder. And something as simple as a broken flap inside a toilet or as serious as a leak beneath the foundation can elevate water usage. 3. Doors and windows that don’t operate correctly: Doors or windows that stick, rub, or won’t fully close can be signs that parts of the home have shifted over time. As a house settles, frames may become slightly misaligned, which can affect how doors and windows function. Additional interior indicators can include cracks in drywall around door frames, windows, or ceiling corners. 4. Repeated power outages: Power companies now proactively cut off electricity in fire-prone areas during high-risk scenarios. Power lines freeze in areas that rarely had to worry about that before. If your luxury property isn’t supported by a backup generator, any outages could cause secondary issues and preventable claims after neutralizing sump pumps and other critical devices. Three ways to reduce your home’s vulnerability: 1. Create a fingerprint of your home: Marking what is “normal” makes it easier to notice when things look less than that. In such cases, we recommend investigating immediately so that a small issue doesn’t have a chance to become a big insurance claim. 2. Engage in regular maintenance: Consider hiring a plumber to inspect your systems annually and bring in roofers to make assessments. It’s also important to change filters in your AC and heating systems, clean dryer vents, or engage a maintenance service to do the work for you. New homeowners can often find these services through their contractor. 3. Speak to your broker: Regular conversations minimize the likelihood that you have an unexpected vulnerability related to your insurance program. And it’s helpful to explore flood and earthquake insurance policies for high-value properties, as related losses are not covered by homeowners' insurance. Proactive spending on small, preventative measures today can help reduce the risk of far more costly expenses down the line. And in the end, a sharp eye and, when in doubt, a quick phone call to a contractor could reduce your home's vulnerability, therefore protecting both your property and peace of mind. ...

Key insurance risks for high-net-worth clients

The greatest risks to your assets may not be the ones you expect. This year’s insurance trends among our client base show that routine exposures—minor water leaks, driveway auto incidents, and overlooked valuation gaps—are often the most disruptive. Knowing where these risks emerge gives you the opportunity to prevent avoidable losses, minimize inconvenience, and strengthen your overall protection strategy. Below are the key insurance risk trends from our clients that shaped 2025, along with what they mean for protecting your home, vehicles, and personal assets in the coming year. Everyday insurance claims drive the greatest frequency of loss The largest volume of claims came from: Automobile accidents Water damage Lost or damaged jewelry Individually, these incidents may not be catastrophic. Collectively, they create recurring financial and lifestyle disruptions. Consistent risk awareness and proactive prevention remain essential components of effective risk management. Auto accidents in driveways and garages are a leading preventable exposure 20% of automobile claims involved our clients' vehicles striking stationary objects, such as gates, poles, parked cars, or garage structures. Most occurred in driveways or other familiar environments, where lowered vigilance often leads to avoidable losses. Slower navigation and heightened awareness in tight residential spaces can significantly reduce exposure. Water damage claims continue to be a primary property risk Plumbing failures, roof leaks, and appliance line breaks continue to generate substantial property insurance claims. Many losses begin as minor, undetected issues that escalate over time. Routine inspections, preventative maintenance, and early leak-detection systems are critical for mitigating water-related risks. Electrical fires represent the highest-severity property claims Electrical-related house fires accounted for the largest individual claim costs in 2025. Common risk factors included: Outdated or faulty wiring Overloaded electrical panels Increased demand from modern home technology As luxury homes integrate more advanced systems, regular electrical evaluations are increasingly important to reduce exposure to high-severity property loss. High-value jewelry losses expose valuation gaps Jewelry remains one of the most common types of valuable-item insurance claims. The largest single jewelry loss for one of our clients this past year exceeded $2M. Common exposure scenarios include: Travel Social events Everyday wear Improper storage Outdated appraisals often result in underinsurance. Regular coverage reviews and updated replacement valuations ensure high-value assets are properly protected. For high-net-worth households, effective insurance protection extends well beyond catastrophic coverage. It requires ongoing alignment between assets, lifestyle, and coverage strategy. Regular property evaluations, updated valuations, infrastructure improvements, and thoughtful policy reviews all play a critical role in reducing exposure. A well-structured risk management approach not only strengthens financial protection but also preserves continuity and peace of mind when it matters most. ...