Texas Boat Dealership Insurance

Every customer truck parked in your lot while its owner takes a sea trial is your responsibility. So is every customer boat in your service bay. Your property policy doesn't cover them because you don't own them. Your GL policy usually excludes property in your "care, custody, or control."

Commercial auto adds another layer. When your techs drive a customer's tow vehicle, or deliver a boat with a company truck, you need hired and non-owned auto coverage on top of your owned-vehicle policy. Plan for rising costs. Dealers in Texas commonly see commercial auto renewals climb 8% to 25%, mostly because of large jury verdicts. For dealers placed in the residual market, TAIPA received approval for a 4.9% commercial auto rate increase effective November 1, 2026.

Garagekeepers Coverage for Towed Boats

Garagekeepers coverage protects customer vehicles and boats while you're storing, servicing, or towing them. It comes in three forms:

• Legal liability: pays only if you're at fault. A fire that starts at the neighbor's shop may leave you uncovered.
• Direct primary: pays regardless of fault. This option generates the fewest customer disputes.
• Direct excess: pays only after the customer's own insurance responds.

A typical claim looks like this: a tech jackknifes a customer's 2026 Sea Ray SLX 260 retailing for roughly $174,900 to over $209,000 on I-45 during a pickup. Without garagekeepers, that loss comes straight out of your operating account.

Business interruption coverage replaces lost income and pays ongoing expenses like payroll, rent, and floorplan interest while you rebuild after a covered loss. For Texas dealers, timing makes this coverage critical. A hurricane in September can damage the building, but a slow rebuild that drags into spring costs you your best selling months.

When you review your policy, focus on three details. The waiting period is often 72 hours, and you get no income replacement during it. The period of restoration should be long enough to account for contractor backlogs after a major storm. Extended business income keeps payments going after you reopen while customers trickle back.

Insurers also reward loss prevention. In August 2026, the governor directed TDI to account for loss-mitigation efforts in rate setting. Document the steps you take, such as backup generators for climate-controlled storage, hurricane evacuation plans that move inventory inland to Waco or Temple, and impact-rated doors. Keep timestamped photos and an inventory log updated in software you can reach from anywhere.

Dealer "don'ts" checklist:

• Don't let unlicensed staff run sea trials.
• Don't assume floorplan lender insurance protects your equity.
• Don't skip reporting a claim. Notify your carrier within 24 to 72 hours, with photos and repair orders.
• Don't leave inventory values outdated. Update them quarterly.
• Don't buy rental liability from a carrier that isn't licensed in Texas.
  

Do I need marine liability if I already have general liability? Yes, if you run demo rides or operate docks. GL policies usually exclude watercraft operation, so on-water accidents go uncovered.

What happens if my insurer drops me? Starting January 1, 2026, Texas law requires insurers to give a written explanation for any declination, cancellation, or non-renewal. Use that explanation to fix the issue before you shop for a new policy.

Does my policy cover boats at a boat show? Only if your dealer open lot or inland marine form includes off-premises and transit coverage. Confirm it in writing before the Houston show.

Is the surety bond the same as insurance? No. The bond protects customers, and you have to repay any claim paid against it.

How often should I update inventory values? Update them at least quarterly, and right after peak-season deliveries.

Insurance for a Texas boat dealer works best when you treat each risk separately. You need liability for both the showroom and the water, property coverage that pays replacement cost, garagekeepers protection for every customer truck and trailer, and business interruption coverage long enough to outlast a slow post-hurricane rebuild. Rates are climbing, especially on commercial auto, so documented loss prevention now affects your premium directly.

Start by pulling your current declarations pages and comparing them against the table above. Mark any line where you're relying on legal liability garagekeepers, ACV valuation, or a restoration period of 90 days or less. Then sit down with an agent who writes marine dealer business in Texas and work through each gap. Do this review before storm season, so you're not finding gaps after a storm has already hit.