Almost nobody thinks about yacht charter insurance until they are standing in the marina office on day one, handing over a credit card for a deposit they did not expect to be this large, reading a contract they do not fully understand, and wondering what happens if they break something expensive. This guide answers those questions in advance.
There are five kinds of cover that matter on a yacht charter: the charter company's hull insurance (which already exists), your security deposit, deposit insurance, skipper liability insurance, and ordinary travel insurance. You will definitely interact with the first three. Whether you need the last two depends on what you are chartering and how.
If you are still working out what kind of charter you want, read our bareboat vs crewed guide and the first-time charter checklist first. This article assumes you have chosen the charter and now need to understand the small print.
The Insurance Already on the Boat
Every legitimate charter yacht has hull insurance arranged by the owner or charter company. This is the primary policy that covers damage to the boat itself, collision damage, grounding, fire, theft, and everything else that can go wrong with a floating piece of fibreglass worth six or seven figures.
The policy always has an excess (deductible). This is the point where your security deposit comes in.
The hull policy also carries third-party liability cover, which protects the boat owner (and by extension, you as the charterer) against claims from other people for damage or injury caused by the yacht. This does not mean your personal liability is fully covered in every scenario, which is why skipper liability insurance exists as a separate product.
You cannot see or buy the hull policy. It is arranged by the operator. What you need to know is: it exists, it has an excess, and the excess is what your security deposit exists to cover.
The Security Deposit (Damage Deposit)
Every bareboat charter requires a refundable security deposit held against damage to the boat, lost equipment, or late return. The amount varies by boat type and value. Rough 2026 ranges:
| Boat type | Typical security deposit |
|---|---|
| Monohull 35-40 ft | 1,500-2,500 EUR |
| Monohull 45-50 ft | 2,500-4,000 EUR |
| Catamaran 42-48 ft | 3,000-5,500 EUR |
| Catamaran 50-60 ft | 5,500-8,500 EUR |
| Motor yacht 12-18 m | 5,000-15,000 EUR |
| Crewed yacht | Usually none (charter contract handles liability) |
The deposit is taken on a credit card, or occasionally by bank transfer, at the start of the charter. It is returned in full at the end if the boat is handed back in the same condition you received it, with all equipment present, on time, with a full fuel tank and the holding tank pumped out.
What it is actually for: the deposit matches the excess on the hull insurance. If you damage the boat, the charter company claims on their hull insurance. The insurance company pays the repair cost minus the excess. The charter company recovers the excess from your deposit. Anything above the excess is on the insurance. Anything up to the excess is on you.
This is why a small chip on a rudder, a scratch on the hull from a fender, or a missing winch handle can eat your entire deposit even though the actual cost of the repair is higher. The insurance is picking up the rest, but the charter company has no reason to pay the excess from its own pocket.
What it is not for: the security deposit does not cover liability claims. If you hit another boat or cause injury to someone, that goes through the hull policy's liability section. The deposit is only for material damage to the chartered boat itself.
The one thing most people do not know: your damage must be backed by repair receipts. A charter company cannot simply keep your deposit because they do not like the look of a scratch. They have to demonstrate the cost. If you have paid for damage you think is cosmetic or pre-existing, ask for the invoice. Many disputes get resolved at this point.
Deposit Insurance (Security Deposit Waiver)
Deposit insurance, sometimes called a damage waiver or security deposit waiver, is the product that replaces or supplements your security deposit. It does one of two things:
-
Reduces your deposit. You pay a one-time fee (typically 200 to 500 euros for a week) and your security deposit drops by 50 to 100 per cent. You still put the deposit on a credit card as an authorisation, but the insurance pays out the excess if you damage the boat.
-
Reimburses your deposit after the fact. You pay the full security deposit as normal. If damage is charged against it at the end of the charter, you claim from the insurance company for reimbursement. Typical cost 60 to 120 euros for a week's cover.
Charter companies offer both versions. Third-party insurers (YACHT-POOL, Pantaenius, nautilusyachting, and others) offer the reimbursement version and are often cheaper than the charter company's own waiver.
When deposit insurance is worth it:
- You are on a larger boat with a deposit over 3,000 euros
- You are less experienced and more likely to make a small expensive mistake
- The charter company's waiver product is reasonably priced (under 200 euros)
- You hate the idea of a large authorisation hold on your credit card
When deposit insurance is not worth it:
- You are on a small monohull with a 1,500 euro deposit (the premium ratio is too high)
- You have chartered this boat type before and are confident
- The charter company's waiver is priced above 400 euros (the economics stop working)
Important coverage detail: most deposit insurance only covers damage caused by normal use and ordinary negligence. If you run aground at speed because you were not looking at the chart, or if you damage the boat under the influence, cover may be excluded. Read the exclusions before buying.
Skipper Liability Insurance
This is the insurance that confuses people the most because it sounds like the charter's own liability insurance but is actually a separate, personal product.
What it covers: damage you cause to someone else's boat, property or person, while skippering a chartered yacht, when the charter's own liability insurance does not fully cover you. For example, you hit a moored yacht, damage their hull worth 80,000 euros, and the third-party liability on your charter contract has a limit of 500,000 euros. In that specific case the charter policy covers the claim. But if the claim exceeds the limit, or the claim is partially attributed to your personal negligence, the skipper liability policy fills the gap.
When you need it:
- If you are skippering a bareboat and you want personal protection beyond the charter's liability cover
- If you are skippering your own boat occasionally and want year-round liability cover that extends to chartered boats
- If you sail in areas with high claim values (US, Monaco, high-traffic marinas)
When you probably do not need it:
- Crewed charters (the crew is liable, not you)
- Single charter holidays in quiet areas
- If you are hiring through a reputable broker and the charter contract has high liability limits
Cost: 50 to 150 euros a year for a standalone policy that covers you for chartered boats worldwide. RYA members in the UK can buy this via the RYA's insurance partners. European sailors can use Pantaenius or YACHT-POOL.
Travel Insurance (And Why It Matters)
This is the insurance that actually saves most charter holidays, and most people book their flights without checking whether their policy covers what they are about to do.
Standard travel insurance typically does not cover:
- Sailing beyond 12 nautical miles from shore (most bareboats do this regularly)
- Pre-existing medical conditions
- Injury while skippering
- Loss of deposit due to a charter company insolvency
- Trip cancellation due to reasons not listed in your policy (work, COVID, illness of a non-insured family member)
- High-value electronics and sports equipment (GoPro, diving gear, watches)
Travel insurance for sailing charterers should explicitly cover:
- Sailing up to 200 nautical miles from shore (or "yachting" as a listed activity)
- Personal liability of at least £1 million (£2 million is better)
- Medical evacuation from sea, minimum £500,000
- Trip cancellation for a broad range of reasons, ideally including work-related cancellation
- Charter company insolvency (rare but catastrophic if the company you booked through goes under before your charter)
Specialist policies from the RYA, Topsail, Admiral Marine, and Pantaenius all offer proper sailing cover. Expect 80 to 200 pounds for a family for a week, depending on destination and cover limits.
The single most common expensive mistake is buying a cheap annual travel policy, skimming the small print, and discovering at the hospital that "leisure sailing" is covered only up to 12 miles offshore and only on boats under 40 feet. By then, too late.
Cancellation and Interruption Cover
The other critical piece that sits alongside travel insurance is cancellation cover for the charter itself.
If you cancel a bareboat charter outside the normal cancellation window, you lose most or all of what you paid. The standard cancellation schedule for most operators looks like this:
| When you cancel | Typical penalty |
|---|---|
| More than 12 weeks before start | 10-30% of total charter fee |
| 8-12 weeks before start | 50% of total charter fee |
| 4-8 weeks before start | 75% of total charter fee |
| Less than 4 weeks before start | 100% of total charter fee |
On a 5,000-euro charter, that is a 5,000-euro loss. On a 50,000-euro crewed charter, 50,000 euros.
Cancellation insurance covers this loss for specified reasons (illness, injury, bereavement, job loss, military service, certain travel disruptions). Cost is roughly 2 to 5 per cent of the charter fee. On an expensive week this is the cheapest peace of mind you will ever buy.
What it does not cover: simply changing your mind, a minor inconvenience, bad weather, or "disinclination to travel". You need a qualifying reason.
Crewed Charter Insurance: What Is Different
If you are on a fully crewed charter, your insurance situation is much simpler. The crew is responsible for the boat. Damage to the yacht goes through the operator's insurance. Third-party claims are handled by the crew's professional insurance. You are not putting down a security deposit.
What you still need:
- Travel insurance covering the destination and activities (diving, tenders, watersports)
- Cancellation cover on the charter itself (built into some contracts, optional in others)
- Personal possessions cover for what you bring on board
What you do not need:
- Deposit insurance (no deposit)
- Skipper liability (you are not skippering)
- Bareboat-specific marine cover
The MYBA charter contract most crewed yachts use includes clear clauses about what happens in the event of damage, breakdown or cancellation. Read those clauses before you sign, particularly the force majeure section (which sets out what happens if the charter cannot proceed due to weather, mechanical failure, or other unforeseen events).
If you want the detail on how MYBA contracts structure the financial side, see our APA explained article.
Real Scenarios and What Happens
Scenario 1: Minor grounding in Croatia, monohull bareboat. You touch bottom leaving a harbour in Korčula. No visible damage. At check-out the base sends divers to inspect the keel. Small crack in the gelcoat, no structural damage. Repair cost: 1,800 euros. Hull insurance excess: 2,500 euros. You lose 1,800 euros of your 3,000 euro security deposit. Hull insurance pays nothing because the damage is below the excess. If you had deposit insurance, the insurance company would reimburse you.
Scenario 2: Dock damage during stern-to mooring in Greece. You come in too fast in a crosswind and hit the stern of the boat next to you. Small cosmetic crack in the other boat's hull. Repair cost: 4,200 euros. This is a third-party claim, handled by the charter operator's liability insurance. Your security deposit is not touched. You file a report at the base and your holiday continues.
Scenario 3: Charter company insolvency. You book a charter with a smaller Mediterranean operator. You pay 40 per cent deposit six months out. Three months before your charter the operator goes into administration. You have no charter. If you paid by credit card (UK) or your travel insurance includes financial failure cover, you get your money back. If not, you are an unsecured creditor and almost certainly lose the deposit. Always pay at least the first deposit by credit card.
Scenario 4: Injury on board. A guest slips on the deck and breaks a wrist. Medical evacuation from a Greek island by helicopter costs 15,000 euros. Hospital and repatriation costs another 8,000 euros. Travel insurance pays everything if the policy covers yachting and the guest's age bracket. If it does not, the bill is personal.
What to Actually Buy
For a straightforward Mediterranean bareboat week with an experienced skipper, the minimum kit is:
- Security deposit on a credit card (automatic, you cannot avoid it)
- Deposit insurance reimbursement product (60 to 120 euros, worth it if deposit is over 2,500 euros)
- Travel insurance with sailing cover to 200 nm (80 to 200 pounds for a family)
- Credit card booking for deposits (gives you Section 75 cover in the UK)
Total additional insurance cost over and above the charter itself: roughly 150 to 350 pounds for a family of four for a week. Against a charter cost of 5,000 to 15,000 euros, this is less than 5 per cent and transforms the risk profile of the holiday.
For a crewed charter the list shrinks to:
- Travel insurance with sailing cover and high medical limits
- Cancellation insurance on the charter fee (2 to 5 per cent of charter value)
- Personal possessions cover if bringing high-value items
How Sulu Helps
We coordinate the insurance piece with the rest of the charter process. We check the charter contract for damage waiver and deposit terms before you sign, flag any unusual exclusions, and point you to the best third-party deposit insurance if the operator's own product is overpriced. For travel and cancellation cover, we recommend specific policies from specialist sailing insurers rather than generic travel companies.
We do not sell insurance. We help you buy the right one. Message us on WhatsApp or Telegram with the charter details and we will walk through the cover you need before you hand over any deposit.