Why buying the boat of your dreams is not all plain sailing

A spot of snorkelling in a secluded cove with no tour guide to hurry you along, cruising the coast to look for dolphins when the fancy takes you or simply bouncing along the waves at high speed - yes, owning a boat can bring many pleasures.

But they come at a price. If you're considering buying a craft, whether a one-man canoe or luxury cruiser, it's vital to consider all the costs. Depending on the scale of your ambition, it can set you back as much as a car or a house.

Aside from the boat itself, there are running expenses such as mooring fees, winter storage, maintenance and insurance - and you must account for the accidents that can happen at sea.

"As a rule of thumb, running costs are about 10% of the purchase price for mid-range boats of around 36ft long," says Stuart Carruthers, cruising manager of the Royal Yachting Association.

"Some, such as motor boats, will cost much more as the price of fuel has risen significantly since November."

Where to buy
If you are keen to start researching a potential purchase, Boatshed.com and ybw.com (Yachting & Boating World) detail secondhand boats for sale. You could use them as a starting point to check whether the price demanded by another seller, say, resembles that of similar models on the site.

Another option is online auction site eBay, which tends to have small boats at competitive prices.

Check the state of the boat before payment. For yachts, you should enlist a marine surveyor to report on its condition. "Don't pay anything to anybody until this is done, even a deposit - and make sure to get a competent surveyor who has indemnity insurance so that if they tell you a pack of lies you've got somebody to sue," says Carruthers.

"Also check they are a member of a recognised organisation such as the International Institute of Marine Surveying (IIMS) or the Yacht Brokers, Designers and Surveyors Association (YBDSA)."

For smaller boats - dinghies - just research whether you're paying the right price given the condition.

Keeping things covered
Before taking to the waves, check safety equipment. And in case you do get into trouble on the water, make sure your marine insurance is sufficient to cover damage to the boat and any other costs arising from an accident.

You should also check on the amount you can claim, should your boat end up in a watery grave.

Boat insurance is not compulsory, but most marinas and harbour authorities insist on third-party insurance, as does British Waterways, which controls most of the rivers and lakes in the UK.

This form of insurance predates all other types of cover, and policies vary in detail and price, which can make comparison tricky. Also, prices will vary widely depending on whether you intend to race or simply cruise along.

It pays to do research and decide on your priorities. Boat owner Damian King, 30, realised the value of his insurance cover when his boat was taken for a joyride by some drunken revellers off Brighton beach this month.

"My laser dinghy was left washing up all night," he says, "with bits strewn across the beach and out to sea - it took a bit of a pounding and I lost quite a few items that were stored in the boat."

However, the science teacher is content with his insurer Noble Marine, which provides "new for old" cover. "I always thought I'd need to replace something on the boat, from damaging it through racing, but I never thought that it would be as a result of an incident like this."

He is claiming on his policy for repair of the boat and the lost items, including spars and sheets. The comprehensive cover costs £130 a year.

Finding insurance
If you want to find out if you are paying the going rate for insurance, you might want to check the websites that give you an instant quote. Craftinsure.com and Covermyboat.co.uk are two such sites.

GJW is the UK's largest direct boat insurer and publishes the full policy document on its website, so you can see exactly what you're covered for, as does Noble Marine.

Always check what is included because, for example, medical expenses are not a feature of every policy.

Top 10 boat insurance claims

Sailing is one of the favourite past times of the over 50's with this age group accounting for over 41% of boat owners in the UK. Contrary to popular belief, theft is not the biggest risk faced by boat-owners according to claims statistics from Saga Boat Insurance.

In fact boat-owners over 50 are now 19% more likely to hit a submerged object, with the average collision claim amounting to £2,394.55. Boat owners can easily protect their vessel by being prepared for the area they are sailing in, having Marine charts on board and ideally having a sonar device fitted. Checking the latest weather and tides is also a must before you set off for your trip.

Theft is still the second most frequent claim of Saga customers with costs averaging £1,218 per claim, and with 15% of theft claims taking place when boats are moored. However, Saga statistics show that this is a 50% reduction on the previous years theft claims, demonstrating that boat owners over 50 have taken onboard advice about the importance of boat security during the current economic climate.

Saga suggests the following hints and tips to avoid being the victim of boat crime-

Don't leave anything loose in the cockpit or on deck

Remove valuable navigational equipment, wet weather gear and personal items

Make sure your curtains (if applicable) are closed so no-one can look in

Ensure that outboard motors, tenders and life rafts are secured to the main vessel with quality locks or chains

Ensure that unfastened equipment such as anchors and oars are secured by wire rope, or chains and locks.

Where relevant, fit a trailer lock to the hitch and a wheel clamp

Police reports also suggest that some items are currently extremely attractive to thieves such as bronze and copper, where the value has soared in recent years. Boats regularly have bronze items in open view such as bells, plaques and statues. Whilst it's not feasible to easily remove or store these items, trying to mask them from view may make the opportune thief look elsewhere for easier pickings.

The top ten frequent Boat Insurance claims are -

1 Striking a submerged object while cruising
2 Theft while moored
3 Collision while cruising
4 Storm damage while moored
5 Theft while laid up
6 Accidental damage while cruising
7 Flood whilst moored
8 Sinking whilst moored
9 Negligence of owner whilst cruising
10 Accidental damage whilst moored

Saga Boat Insurance reveals top ten claims

Saga Boat Insurance has unveiled the top ten reasons why owners of their own vessels claim on their policies.

The most common mishap for those with their own boats in the UK is hitting a submerged object during cruising. Close behind in second place is theft while the vessel is anchored.

Collisions with other boats is the third most common insurance claim cause, with storm damage and theft while in storage claiming the fourth and fifth slots.

Accidental damage mid-cruise and flooding and sinking while moored constitute sixth, seventh and eighth place respectively.

Owner negligence and accidental damage are the final reasons why insurance is claimed by boat owners, Saga highlights.

In July, Saga stated that thefts from boats are more likely to occur in the summer months rather than in winter time.

Seaworthy Launches Boat and Yacht Insurance Program

Seaworthy Insurance Co., which began in 1989 offering specialized boat insurance products to Boat Owners Association of The United States (BoatU.S), has launched a new line of commissionable boat insurance policies sold exclusively through insurance agents and brokers. Now a member of the Berkshire Hathaway Insurance Group, Seaworthy Insurance Co.'s new agent program offers four types of policies: pleasure boat, yacht, super yacht, and charter vessel.

Both pleasure boat and yacht policies are also available as liability only, and include wreck removal, salvage coverage, and fuel spill liability. Super yacht policies include coverage for crew, tenders, and offer broad cruising limits including the Mediterranean, Caribbean, Panama Canal and the Pacific. Charter policies are available on both "Six-Pack" and inspected vessels, and offer valuable coverage options including a low electronics deductible and coverage for the loss of a charter booking.

All Seaworthy policies offer hurricane preparation coverage that pays 50 percent of the cost to haul or move a vessel out of harm's way.

The Seaworthy Web-based rating and quote system has a single screen to allow agents to obtain a quick quote for their customers. Agents can then e-mail the quote, print applications and binders as well as review client billing, account information and claims status.

Top 10 boat insurance claims

Sailing is one of the favourite past times of the over 50's with this age group accounting for over 41% of boat owners in the UK. Contrary to popular belief, theft is not the biggest risk faced by boat-owners according to claims statistics from Saga Boat Insurance.

In fact boat-owners over 50 are now 19% more likely to hit a submerged object, with the average collision claim amounting to £2,394.55. Boat owners can easily protect their vessel by being prepared for the area they are sailing in, having Marine charts on board and ideally having a sonar device fitted. Checking the latest weather and tides is also a must before you set off for your trip.

Theft is still the second most frequent claim of Saga customers with costs averaging £1,218 per claim, and with 15% of theft claims taking place when boats are moored. However, Saga statistics show that this is a 50% reduction on the previous years theft claims, demonstrating that boat owners over 50 have taken onboard advice about the importance of boat security during the current economic climate.

Saga suggests the following hints and tips to avoid being the victim of boat crime-

Don't leave anything loose in the cockpit or on deck

Remove valuable navigational equipment, wet weather gear and personal items

Make sure your curtains (if applicable) are closed so no-one can look in

Ensure that outboard motors, tenders and life rafts are secured to the main vessel with quality locks or chains

Ensure that unfastened equipment such as anchors and oars are secured by wire rope, or chains and locks.

Where relevant, fit a trailer lock to the hitch and a wheel clamp

Police reports also suggest that some items are currently extremely attractive to thieves such as bronze and copper, where the value has soared in recent years. Boats regularly have bronze items in open view such as bells, plaques and statues. Whilst it's not feasible to easily remove or store these items, trying to mask them from view may make the opportune thief look elsewhere for easier pickings.

The top ten frequent Boat Insurance claims are -

1 Striking a submerged object while cruising
2 Theft while moored
3 Collision while cruising
4 Storm damage while moored
5 Theft while laid up
6 Accidental damage while cruising
7 Flood whilst moored
8 Sinking whilst moored
9 Negligence of owner whilst cruising
10 Accidental damage whilst moored

Boat theft – another side to the GFC

The global financial crisis has certainly hit the boating industry hard, but sadly there’s another side to the GFC and in this case I’m referring to theft, theft of boats and theft of equipment from boats.

A serving police officer once described to me what he felt was the difference between honest and dishonest people – 'Respect,' he said, 'dishonest people have no respect for your rights or your property.'

Sadly, that seems to be the case at present with a reported ‘spike’ in nautical thievery.

Trailer boat theft and the stealing of valuable equipment from moored vessels has always been a problem, but it seems that tough times lead to an increase in this insidious past time.

And, would you believe, stealing from moored vessels increases during school holidays?

Nice!

Do you know what your ‘little Johnny’ was up to during his school holidays?

Of course, stealing boats and stealing from boats is something all honest people pay for by way of increased insurance premiums.

In Part II of ‘Boat Theft – another side to the GFC’ I speak to a number of key insurance people and learn just how much these ‘low lifes’ cost us by way of increased premiums.

Needless to say, payouts by insurance companies are highest when it comes to complete trailer boats stolen, but equipment stolen from moored or berthed vessels is becoming more expensive, with GPS plotters, fish founders, ‘sounders, small outboard engines, even tenders increasingly becoming targets.

The popular Data Dot technology, I’m told, does tend to deter professional thieves looking to on-sell a boat or equipment for a quick profit.

However, opportunistic or amateur thieves usually would not even know what Data Dot is.


For the uninitiated, Data Dot is a clever system whereby thousands of tiny dots laser etched with a VIN (Vehicle Identification Number) or PIN (Personal Identification Number) that can be read by police via a unique magnifier to prove ownership.

Several motor vehicle manufacturers ‘spray’ Data Dot on their vehicles and a number of outboard engine and motorcycle producers follow suit.

Nevertheless, as much as it helps there’s really no absolute way to deter thieves if you vessel is in any way left unattended.

If you trailer boat is left outside your home, adorn it with all the chains and padlocks you desire, it won’t stop a determined thief.

Likewise, thieves can quickly learn which boats on swing moorings are berthed at marinas are left unattended for lengthy periods.

I was reminded of a tale I picked up in the US some years ago, that of a thief serving time in gaol for carrying out his ‘trade.’

He explained that he always targeted a well-known and common brand (rare or unusual boats stand out, he said).

His method of operation was to stroll casually around marinas, select a ‘likely vessel’ and look for one with an owner on board.

Owner on board?

Yep, here’s how he worked.

'I’d pretend to the owner that I was very impressed with his vessel and knew that boat owners loved to talk about their pride and joy', he said.

'After a few minutes conversation I knew what engines he had, what electronics were on board, knew his name and that he lives three states away and came to his boat every second weekend.

'That was it, I had my next target.'

One week later, that ‘gentleman’ (and I use the word loosely!) arrived at the marina on the very weekend he had already determined the owner would be absent, checked in at the marina office, told them that Mr ……… (he already had his name, remember?) had requested some work on his boat.

Marine staff escorted him to the boat, helped him untie the lines and bid farewell as he motored off into the distance.

How easy was that?

Despite that example of one very smart thief in action, security is pretty good at most commercial marinas.

I’m aware of a couple of incidents in Australia similar to the US example, but by far the vast majority of insurance claims relate to stolen trailer boats and stolen marine equipment rather than big vessels.

Most insurance companies give bonuses on premiums where the insured vessels are berthed at a recognised marina.

Those on semi-deserted swing moorings are likely to be paying higher premiums.

Apart from keeping your trailer boat out of sight, or even better, in a locked garage, there’s not a lot that can be done to deter thieves.

Be particularly aware if you’re advertising your boat for sale; thieves often scour the classified looking for suitable craft to ‘pinch.’

A standard method is to contact the owner of an advertised boat, obtain all its details, and determine if it is good value to steal.

The thief, of course, makes an appointment to inspect the boat, but is a ‘no show’.

That’s the least pf his worries, he now knows the location of a trailer boat worthy of his ‘talents’ and within a few days of the advertisement being placed that boat has been ‘nicked.’

Next week, we’ll endeavour to look into various ways and means to help you protect your investment and we’ll talk to the people in the ‘front line’ battling thievery every day, the insurers who have to ‘cop it’ whenever thieves strike.

Protect your boat before the storm arrives

No boat owner can forget the aftermath of Hurricane Frances.

The slow-moving tropical storm made landfall on the Treasure Coast as a Category 2 hurricane on Sept. 3, 2004.

Winds of 100-110 mph lashed the region for hours. Those shredding winds generated storm surges and severe erosion while flooding rains pounded the area.

Left in her wake were thousands of destroyed and sunken boats, including scores piled in wreckage at Fort Pierce City Marina.

Unfortunately for many boat owners and marina officials, photos of the devastation there became the iconic image of Frances’ fury.

Since that costly year of nine hurricanes, including four that swept over parts of Florida, the threat of a hurricane’s serious impact to the Treasure Cost boating community has been a stark reality.

As the suspiciously quiet Hurricane Season 2009 nears its active months, here are a few tips for boaters to protect their property — and in some cases, their livelihood — from the worst that Mother Nature has to offer.

Have a Plan

Boats are damaged by a combination of factors created by hurricanes — wind, waves, surge and rainfall.

First, protect a vessel months before the first tropical wave shows up.

Find the best location to protect your vessel and begin preparations. Also, have an alternate spot just in case an unforeseen problem occurs.

On the Hard

In-water vessel owners should consider hauling their boat out prior to a severe storm’s arrival.

Many Treasure Coast marinas and boat yards provide the service and have areas where boats can be securely anchored.

Facilities like River Forest Yachting Center on the St. Lucie Canal in Stuart offer a Hurricane Club membership, which guarantees a reserved space during hurricanes and preferential treatment over non-members despite paying “non-hurricane” rates for haul out, jack stands and blocking.

However, membership does not make a boater exempt of responsibility. For example, the St. Lucie Locks which River Forest is west of — closes when wind speeds reach 30 mph.

Also, in peak, high traffic conditions very close to the storm’s arrival, even members cannot be serviced ahead of other waiting boats.

July 4th liability insurance issues for Los Angeles home and boat owners

July 4th presents serious liability insurance issues for Los Angeles home and boat owners. Planning a July 4th celebration near Los Angeles? Here are many reasons it would be smartest to take your guests to see one of the many professional fireworks shows in Los Angeles County.

You may be assigned at least a percentage of the liability for any injuries or other damages that take place on or near your property as a result of your July 4th festivities. You may be held financially accountable.

This is absolutely true if you own a dog or if your property has a swimming pool. Less obvious is your liability risk for July 4th fireworks that your guests let off on or near your property. If it is your property, then it is your responsibility to make sure all activities are done safely and legally. Each individual municipality in Los Angeles County and in the surrounding counties has its own regulations on individually let fireworks. Make sure any fireworks on or around your property are legal. Use extreme caution even if individual fireworks are legal in your municipality. Los Angeles is very dry, and fire danger is extreme.

If using fireworks near Los Angeles:
1) Make sure the fireworks are legal in your municipality.
2) Use extreme caution to protect lives.
3) Get liability insurance.
Contact your insurer and make certain you are covered for any injuries or other damage fireworks might cause.

If you serve alcohol or other drugs and your guests get in a car accident, fight, speed contest, or other dangerous incident at or after leaving your July 4th party, then you may be assigned at least a percentage of the liability for any injuries or other damages that result. You may be held financially accountable. This is especially true if you serve alcohol or other drugs to minors under the legal California drinking age of twenty one.

"If it's your boat, then it's your responsibility."

July 4th is one of the busiest days on Lake Havasu and other waterways near Los Angeles. Crowded conditions are dangerous, especially for water skiers. Just like you hear it in the California Department of Boating and Waterways commercials, "If it's your boat, then it's your responsibility." What you may not realize is, they mean it. It is your legal responsibility to make certain that everyone on and around your boat is safe. You have liability for any injuries or other damage that happen as a direct result of anyone's use of your boat. You will be held financially accountable. Also, in California driving a boat while intoxicated is considered "Driving Under the Influence" (DUI) just like driving a car while intoxicated. Don't do it.

Have a safe and sane 4th of July!

Lawmakers call for new financing terms for boat dealers

A dozen members of the U.S. Congress delivered a letter Friday to Ben Bernanke, chairman of the U.S. Federal Reserve Board, and Timothy Geithner, secretary of the U.S. Treasury calling on the two to reclassify boats and recreational vehicles as an asset class in the Fed's Term Asset-Backed Securities Lending Facility, and to hurry up.


Lowering the so-called "haircut level" — the amount of an asset's value that may not be used as collateral — would improve liquidity for boat dealers, they said.

The haircut level for an average floorplan term of three years is 13 percent.

Using TALF funds for other lending requires an asset value exclusion ranging from 5 percent for prime credit cards to 16 percent for financing automotive rental fleets.

"We write to express our collective concern that the Term Asset-Backed Securities Loan Facility (TALF) is not proceeding with sufficient pace or with sufficient participation within the nonauto floorplan asset classes," the group wrote. "As members of Congress who represent many marine manufacturers and dealers we urge you to re-examine elements of the TALF program, and specifically the haircut schedule for nonauto floorplan asset-backed securities."

Does My Marine Insurance Policy Cover Earthquake Damage?

Generally speaking, the limits and exclusions of any insurance coverage will be spelled out in the language of the policy document that is issued by the insurance company.



Here, the reader is referring to a requirement of California law (section 10081 of the California Insurance Code) that provides that no policy of residential property insurance may be issued in California unless the named insured is offered coverage for loss or damage caused by earthquake.

The law in its current form was enacted in 1994 after the Northridge earthquake. Prior to that event, insurance companies were required to include earthquake coverage in residential insurance policies, but no provision was available to offer the insurance under a separate policy. After the Northridge earthquake, many insurance companies pulled out of California entirely, rather than being forced to include coverage in their standard residential homeowners’ policies.

The new law offered a compromise. Insurance companies may now exclude coverage for earthquake damage, so long as they offer a separate policy to the homeowner that does provide the coverage. The separate earthquake policy is therefore only required if the homeowners’ policy itself excludes coverage for earthquake damage. This helps the insurance companies because they may charge competitive rates for the homeowners’ policy without regard to the risks associated with earthquake coverage. The separate earthquake policies may better target the risk by charging substantial premiums, and requiring a deductible of up to 15 percent of the value of the insured structure.

Like homeowners insurance, the coverage and exclusions of a marine insurance policy will be spelled out in the language of the policy document. Marine insurance policies vary widely in the scope of coverage offered, but they do not typically exclude damage caused by an earthquake. However, even if such an exclusion were included in a policy, the insurance company would not be required to offer separate earthquake coverage, since the law that requires the coverage does not extend to marine insurance.

The reader asked whether his marine insurance policy would cover earthquake damage to his boat under various scenarios, such as in dry storage, on a trailer or in a marina. The answer is that the damage may be covered, or it may be excluded if his insurance policy does list a specific exclusion for earthquake damage, or it may be excluded by some other provision of the policy that has nothing to do with earthquakes.

Unfortunately, there is no simple, universal answer to this question. The reader will need to review the language of his policy, to determine the scope of coverage offered by the policy and the exclusions and other limitations (such as geographic limitations) that may apply. A maritime attorney experienced in insurance coverage issues should be consulted for more specific information.

The Institutes Offer Helpful Hurricane Tips

June 16, 2009 -- The American Institute for CPCU/Insurance Institute of America offer the following article, "Hurricane Helpful Hints," by Donna J. Popow J.D., CPCU, AIC.

They often show up with little warning, bringing high-speed winds and torrential rain. These destructive forces of nature are unwelcome guests in any home.

Hurricane season is here. Are you prepared?

There are several precautionary measures you can take before the need arises:

Check your policy - wind damage is usually covered by homeowners' policies, but flood damage is not.

Buy flood insurance if necessary - water that accumulates in the street from rain or storm surge will be considered flood water.

Check the policy limit - make sure you can rebuild for the amount you are insured. See if you have Actual Cash Value coverage or Replacement Cost coverage.

Have a plan - know the steps you will take to prepare your home for a storm.
Gather supplies - have the supplies you will need on hand at the start of the hurricane season, such as pre-cut plywood and sandbags.

Secure your boat - if you own a boat, plan where you will take it in the event of a storm. Check your marina or dock contract to see if you are required to move the boat. Have the supplies on hand to prepare the boat for the storm, such as anchors, chains, and chafe protection.


When you receive warning of a storm, follow these guidelines before the storm arrives:

If ordered to evacuate, do so - take your homeowners policy, auto policy and boat policy or the agent's name and phone number or the 800 number for your insurers.
Take valuable items from your boat - take the loran, GPS, registration papers and log books. Do not try to weather a storm on board your boat.

Collect supplies if you're staying home - make sure you have food, water, medical supplies, batteries, candles and pet supplies for three to five days. Don't stock up the refrigerator, but do turn the temperature to its lowest setting so food will last longer if you lose power. Stay indoors and avoid trees and flying debris.


Follow these instructions after the storm:

Contact your insurer - advise your insurer of the damage. Give them a phone number where you can be reached, especially if you have relocated temporarily.
Prepare an inventory of the damage - take photos. Keep track of money spent and keep receipts. Make temporary repairs if necessary.

Check on your secondary home - make arrangements with a realtor or property manager to inspect it. Even if there are no visible signs of damage on the exterior there may be interior water damage.

Boating deaths up in Michigan

LANSING, Mich. (AP) - Boating deaths reached a six-year high in Michigan last year, according to a new report from the Michigan Association of Insurance Agents .

The organization said in an annual report that 36 boating deaths were reported in 2008, up from 35 in 2007 and the most since 2002, when 38 deaths were reported.

Boating accidents also increased last year, to 201 from 193 reported in 2007, though accidents were down from the 226 reported in 2003, according to the report.

Most accidents occur on Sunday afternoons in July, the group said. The most common accidents result from collisions with other vessels, falling overboard and capsizing.

"Whenever people consume alcohol and operate a boat, bad things usually happen," Gary Mitchell, spokesman for the Michigan Association of Insurance Agents, said in a statement. "After years of decline, the fatalities are beginning to increase again."

There were 927,914 boat registrations in Michigan in 2008, up from 830,835 the year before, the report said.

The group advises boaters to wear life jackets, avoid overloading a craft with passengers and make sure the boat has adequate lighting at night and safety equipment. Public awareness of boating laws and using life jackets are the most effective ways to reduce boat fatalities, it said.

Copyright Associated Press

Boating: How to secure your boat when a hurricane threatens

The hurricane season is upon us, and the key to protecting your boat from hurricanes is planning, preparation and timely action. Your plan should include what you are going to do with your boat. Arrange for a friend to carry out your plans if you are out of town during hurricane season.


Boats remaining in the water: Double all lines. Rig crossing spring lines fore and aft. Attach lines high on pilings to allow for tidal rise or surge. Make sure lines will not slip off pilings. Inspect pilings and choose those that seem strongest and tallest and are properly installed. The longer the dock lines, the better the boat will be at coping with high tides. It is also essential to double up on all lines and use chafe protectors at any potential chafing points. Install fenders to protect the boat from rubbing against the dock, pilings and other boats. Cover all lines at rough points to prevent chafing. Wrap with tape, rags and rubber hoses. Make sure that the batteries are charged and that the bilge pumps are in working order. Take down canvas if you have it because because the wind will just tear it down.

Boat on lifts: Raise the lift up as high as you can out of the water so that the storm surge does not catch the boat and take it off the lift. Remove everything that is removable. Make sure the bilge pumps and batteries are working or remove the plug from the boat. Remove the batteries if you do remove the plug. Make sure the electrical system is off. Make sure the cleats are bolted with black plates.


Boats on trailers: Be sure your tow vehicle is capable of properly and adequately moving the boat. Trailer tires, bearing and axle should all be in good condition. Once it is at a safe place, let some air out of the tires. Remove everything that is removable. Remove the batteries, put blocks under the axles and fill the bilges about one-third with water. This will add weight and assist is holding the boat and trailer in place. An alternative to adding water would be to take the plug out and add some weight with a sand bag. It is not a good idea to tie the trailer to a tree, since trees are often blown over in a storm.


Boats in a marina: Double up all the lines and speak to the dock master. Check your rental agreement. Know your responsibilities and liabilities as well as those of the marina.


For all boat owners: Consolidate all records including insurance policies. Have a recent photo of your vessel. Be sure you have boat registration, equipment inventory, lease agreement and telephone numbers of appropriate authorities (harbor master, U.S. Coast Guard, insurance agent).


Remember, when wind and seas warrant, marine agencies remove their boats from service and will not be able to rescue foolish boaters.

Some basic tips to keep your boat from theft

So you think your boat is all safely buttoned up for the winter, tucked safely away in your backyard or driveway? Think again.

In Houston Texas, thieves stole four boats in just five days, stealing electronics, fishing equipment and other items. Even more disturbing, all of the boats were kept right behind the owners’ homes. Boat owners are a trusting lot and while one would not think of leaving the house with all the doors and windows open, boats are often left wide open and unsecured, equipped with all sorts of small and valuable accessories that can easily end up on eBay.

Boats are also so easily transportable, they’re particularly susceptible to theft. Each year, insurance claims for theft losses cost the industry and consumers millions. While some boat thefts are the work of sophisticated rings that target a specific type of boat, others are isolated crimes of opportunity by petty thieves taking small, but valuable, equipment.

Not surprisingly, Florida is the number one state for boat theft with 1,478 boats reported stolen in 2005 and 1,233 stolen in 2006, through Sept. 30, according to the National Insurance Crime Bureau, a non-for-profit organization of insurance companies that compiles reports of stolen boats, cars and other items. Texas is therd in the nation with fur hundred boat thenfts and four thoudand eight hundred and ninety one thefts reported from boats.

According to NICB, 6,849 boats were stolen nationwide through Sept. 30, and a total of 8,795 boats were stolen in 2005. Most of the top 10 states for stolen boats are year-round boating states such as Florida, Texas, California and other southern states, where there are more boats available to thieves as well as more homes, marinas and storage facilities that thieves can target (see chart).On a positive note, law enforcement agencies and prosecutors are taking boat theft seriously and making headway in arresting organized rings of criminals who often move boats across state lines for resale.

“This can’t happen to me” you say. Well guess again. What can we as boat owners do to help protect ourselves? Well we caqn do the following.Engrave all valuables including electronic equipment, outboard engines, radios, loose gear, etc. with the owner’s name, home port, state driver’s license or identification number, and the boat’s hull identification number.

Attach inverted, strong hasps and padlocks to all hatches and secure lockers with non-removable hasps and hinges and lock with strong padlocks. Remove all portable valuables from your vessel, thereby eliminating possible targets of the thief. Don’t leave radios, binoculars, cameras or laptops on board. Maintain an inventory list that includes all boat gear with the name, model, serial number, manufacturer, and description of each item. Digital images or photos of your gear could also go into this list. Never leave keys aboard a boat, even in a “hidden place.”

Any seasoned burglar knows all the spots to look. Don’t leave ownership papers on board the boat. Over night stays at a marina ,even one with good security you should check for one with locked gates and other barriers to keep both unauthorized pedestrian and vehicle trafficaway from the docks. Signs should be posted that clearly state marina regulations and access limits.Access to boats should be limited only to owners and other authorized persons. Look for one with good lighting. Lighting should be focused on access points and boat docks, security cameras are even better. As a boat owners you should get acquainted with their dock side neighbors and report suspicious “visitors” and activities.

When you leave your boat on a trailer away from your own watchful eyes you should think of removing the tires. As an added precaution against theft, be sure to remove the hub nuts and store them with the tires. Keeping your boat out of sight is less tempting to theives. If the boat has to stay in the driveway, don’t park it facing the street. Thieves may carry coupler devices that can be quickly attached to your trailer.smaller outboards should be taken off and stored in the garage along with your seats, batteries, electronics and fishing equiptment in side, they’ll hold up better when stored indoors as well.

Lock your wheels to the trailer. A length of heavy chain, or cable, run through each wheel and around the axle or trailer frame is a great deterrent to theft of the trailer or your wheels. Also, lock your spare tire. These few and simple tips could possible save you the boat owner thousandsof hard earned dollars. Even a small theft from a high performance craft can result in a expensive lesson that should’nt haver to be learned the hard way. Takes care of your equiptment and it will be there to take care of you. Remember spring is around the corner and we all want out big boy toys to be there when we’re ready to play so until next week keep only what you will eat and release the rest to fight again.
Mike Harber

How to Slash Rates on Your Auto Insurance

Auto insurance is a mundane game, right up there with root canals and visits from the in-laws; they’re things people don’t want to experience, but have to.

So as long as you’re stuck paying auto insurance, at least you can find ways to cut the costs of buying it.

Here are some of the best ways that BankingMyWay found to do just that:

Order the “combo” platter – If you buy your home and car insurance from the same company, you save, as the commercial says, up to 15% off your car insurance. That’s the figure stated from the Independent Insurance Agents & Brokers of America.

Shop online – If you value a local insurance company in town, or a short drive away, skip past this tip. But if you don’t care where your auto insurer’s office is, go online for a great deal. Online auto-insurers tend to be short on great, hands-on customer service, but they’re very good on getting you lower rates, since their administration and operating costs are so low.

Leverage good credit – No doubt about it, the better your credit, the lower your auto insurance rates. Consumers with good credit scores of about 660 and above can expect good discounts at the auto insurance checkout counter.

Avoid collision insurance – If your car is paid off, or you’re driving around town in an aging, beat-up junker, your need for collision insurance isn’t a big one. By removing collision insurance, you can take up to 20% off your auto insurance. A note: without collision insurance, you’ll need some money set aside for “crash” emergencies, the amount of which should be based on the current Kelly Bluebook value of your car.

Raise your deductible – To lower your insurance rates, just raise your deductible. Raising your deductible from $150 to $500, or even $1,000, could save you up to 15% off your insurance rates.

Get a “two vehicle” discount – If you own more than one car, or even a car and a boat, ask your insurer for a multiple vehicle discount. To get your business on both vehicles, chances are your agent will green light a discount.

US boat buyers offered payment protection

PROTECTION: Taking a lead from the US auto industry, Brunswick has set up a payment protection programme for buyers of its Bayliner, Maxum and Trophy brands.

Under the protection promotion these three Brunswick boat brands will make the monthly boat payments for those buyers who may unfortunately lose their jobs due to current economic conditions, said Brunswick in a statement released on 22 May.

Bayliner, Maxum and Trophy will pay up to nine months of payments if the boat buyer loses his or her job within a year after the boat purchase.

‘In today’s economy, it is important to alleviate consumer concerns over many issues, including the potential of job loss,’ said Brunswick chairman and chief executive officer Dustan E. McCoy. ‘So, we’re addressing it in an effective and impactful manner within the marine community. These brands aim to restore some confidence for the American boat buyer so they can make their dream boat purchase this summer, because we stand behind them not only with quality products, but also with resourceful financing and insurance options.’

Payment Protection is offered for all models in the Bayliner, Maxum and Trophy brand lines, with the qualifying monthly payments going up to $500, McCoy explained.

The promotion started for the US Memorial Day weekend – which suns as the same time as the UK Spring Bank Holiday - to help them sell more new boats during this year's peak boat selling season, which Brunswick says continues through the Fourth of July weekend. Customers must take delivery of their new boats by 6 July.

‘These brands are among the first in the marine industry to launch such a large-scale payment protection program,’ said the president of Brunswick's US Marine and Outboard Boat Group divisions, Andy Graves. ‘We’re taking our cue from similar efforts that have been used successfully in the automotive industry by Hyundai, Ford and General Motors.’

Warships blamed for Somali piracy

Somali minister has said the problem of piracy in the region is being made worse by those countries deploying warships off the coast.

Abdul Karis Osman Issa, public works minister in semi-autonomous Puntland, said investment should be directed at building mainland security instead.

He said ransom payments to pirates mean they are better financed and armed than the regional government.

Meanwhile, Mogadishu is reportedly calm after three days of fierce fighting.

But correspondents in the city say clashes between pro-government forces and opposition Islamist groups could resume at any time.

More than 50 people have been killed in the clashes, which began on Thursday and escalated late on Saturday in a district close to the presidential palace.

Somalia, a nation of about eight million people, has experienced almost constant conflict since the collapse of its central government in January 1991.

Next ArticleAnchorage Boating Examiner Boat safely by getting a Vessel Safety Check

We are near the beginning of boating season in Alaska and now is a good time to review what required equipment should be onboard and ready for use. One easy way to ensure your boating safety gear is up to speed is to request a Vessel Safety Check from the U.S. Coast Guard Auxiliary. The exam looks at the equipment required by law and makes recommendations for other safety gear that should be onboard.

So what does the examiner look for to ensure your boat is safe and legal to operate?

Required Equipment

Registration - Boats must be currently registered by either the state or federal government. The Federal government usually documents (a form of registration) boats that are larger than five net tons.

Personal Floatation Devices (PFDs) or Lifejackets - One USCG approved PFD is required for each person onboard. A throwable or Type IV PFD like a ring buoy or floating cushion is required on boats over 16 feet in length.

Visual Distress Signals - Depending on the time of operation, day and/or night distress signals need to be carried onboard vessels

Fire Extinguishers - Vessels that have mechanical propulsion are required to have a USCG approved fire extinguisher onboard. The number of extinguishers depends on the length of the vessel.

Ventilation – Boats that have gasoline powered engines installed in closed spaces (inboards) within the boat must be equipped with powered ventilation system to prevent to build up of explosive gasoline vapors.
Backfire Flame Arrester - Gasoline engines equipped with a carburetor need a USCG approved backfire flame arrester.

Sound Producing Device - Collision avoidance regulations depend on boaters carrying sound producing equipment.

Navigation Lights - Operating navigation lights are required for operation of your boat at night and in conditions of reduced visibility like fog.
Regulatory Placards - Placards or regulatory notices must be posted on vessels over 28 feet in length. These placards notify the operators of regulations addressing oil pollution and proper disposal of marine related garbage.
Recommended Items

Marine VHF Radio - A marine VHF isn't required by law, but can be a real lifesaver. The Coast Guard communications system is geared to using these radios, and they are often more likely to perform better than cellular phone system.
Alternative Dewatering Pump - Carry a spare, manually operated pump for bailing out your boat. You should have something available to bail out your boat that does not depend on the vessel's power system.

Mounted Fire Extinguishers – It is beneficial to mount your fire extinguishers. A fire extinguisher that is stowed will not be readily available when you need it.
Anchor and Line – An anchor provides options during a mechanical breakdown, it keep you off the beach and prevent you from drifting further ashore while you troubleshoot the problem.

First-Aid Kit - A first-aid kit onboard makes a major difference in your ability to respond and treat an injury that occurs during a trip.
Capacity Plate/Certificate of Compliance - Most boats built under approval standards set by the Coast Guard will carry a placard that states the maximum recommended load and passenger capacity of the boat. Larger boats may carry a manufacturer's statement of compliance with Coast Guard vessel standards.
Once you successfully complete the VSC, a decal is affixed to your boat certifying completion of the inspection. Completion of a VSC may qualify you for discounts on liability insurance at State Farm and boating equipment purchases at West Marine. Go to the Vessel Examiners Database and enter your zip code find a VSC examiner near you.

New third party insurance policy launched

Navigators & General has launched a new third party only boat insurance policy for boaters who may find the cost of comprehensive cover prohibitive. It is designed to meet the requirement for third party cover made by many marinas, harbours, waterways and boatyards.

"There have been increasing instances of fires leading to damage to nearby craft, and boats becoming unmoored and drifting into others", said N&G head James Roberts. "We wanted to provide low cost cover for boat owners who are simply looking to lay their boat up in a yard outside peak sailing season or whilst it's up for sale".

The policy, which can be taken out online, includes liability protection against passenger or third party claims, cover for wreck removal and destruction, and pollution related costs and fines.

SKorean wife collects fortune for 'dead' husband

SEOUL (AFP) — A South Korean woman who held a funeral for her husband after claiming he was lost at sea scammed insurers out of 800,000 dollars before he was found alive and well, police said Tuesday.

The fraud in the southeastern town of Tongyeong is part of an increasing trend of bogus claims, insurers say.

It began in March 2006 when she told police that her husband had failed to return from a fishing trip, a police spokesman in the nearby city of Changwon told AFP.

The husband had left his boat adrift and sneaked back ashore on a different boat as a major sea search was launched.

He went to ground for some three years elsewhere in the country as his wife successfully filed claims totalling 1.1 billion won with six insurance firms.

She even held a funeral for her spouse, receiving the customary condolence cash payments from mourners.

The pair finally came to grief when the husband shared his secret with an acquaintance during a drinking session and the friend reported it to police.

They will face criminal charges, the police spokesman said.

The Seoul Shinmun newspaper said insurance scams were becoming "low-risk, high-return" crimes.

Kim Seong, an official of the General Insurance Association of Korea, told the daily such crimes have risen sharply since the 1997 economic crisis,

The Financial Supervisory Commission said 41,019 people were caught over insurance frauds last year, up 33 percent from a year earlier.

"However, statistics on insurance frauds fail to reflect reality, as many people are believed to get away with these crimes," Kim said.

Spamtown Belle boat saved — again

City council removes tourist attraction from Park and Rec budget reductions
By Katie Johnson (Contact)
Funding for the Spamtown Belle will keep the Mill Pond boat afloat — at least for now.

The paddlewheel attraction was on the list of proposed cuts for the Austin City Council to review in the Austin Parks, Recreation and Forestry Department.

Operated by volunteers from June through September, the boat has a history of being out-of-commission due to repairs. Council members debated whether or not to eliminate its $1,100 contribution slated for 2009 and 2010 Monday night.

Belle Captain Dick Nordin spoke at the meeting, and explained that last year, one-third of riders were from out-of-town, and the boat had 1,000 riders in August and September. The boat was in for repairs most of the season.

“Quality of life — that’s important to a community,” Nordin said when stating his case.

Rides are $1 for kids and $2 for adults. The boat was donated to the city in 1999.

“The issue I have is, that pond gets so green and skanky during the summer,” Mayor Tom Stiehm said.

Nordin suggested the boat be moved back to East Side Lake.

The Belle has long been a controversial topic in the community, as some see it as a tourist draw, while others view it as a waste of money.

“We hear from people all the time … you have a boat, and you have layoffs,” Stiehm told Nordin of its proposed budget elimination.

Insurance for the boat costs $2,000, Nordin said. If the city paid that, he should be able to fundraise to keep it operational.

“I agree with you, Dick--it’s a really neat vessel,” council member Jeff Austin said. “Part of what has worked against you is the condition of the boat.”

The fact that Austin has two ice arenas — Packer and Riverside — has long been another hot topic in the community.

Tom Dankert, director of administrative services, has reiterated many times that the facilities were never meant to be money-makers, but services for citizens in the city. However, Erichson said Riverside has been very busy with events lately.

One proposal is to close an arena, likely Packer, to save an estimated $90,000 in 2010.

“If we were to close an arena, we would recommend closing it in fall 2009,” Erichson said. “The big decisions start hitting in fall 2009.”

Council member Janet Anderson said she wants more information before even considering closing one or the other. She suggested getting more information from interested parties.

“I have a hard time, when you are taking away things for the youth of Austin to do,” council member Steve King said. “Yeah, it’s $90,000. It’s a lot of money.”

Other Park and Rec reductions that have been recommended for approval April 6 include: waiting to replace the public pool vacuum, tile and equipment; using temporary staffing for secretary, director Kim Underwood’s former position; reducing the pool season by two weeks to June 13 through Aug. 16; increasing pool fees and private rental rates; eliminate tree-planting in the boulevard; reducing hours and days of the Youth Activity Center; and reducing temporary salaries for baseball parks and the Izaak Walton Cabin.

The council voted to recommend all proposed cuts in the Park and Rec budget for approval April 6, with the exception of keeping the Spamtown Belle and waiting to get more information about the arenas. Council members Dick Pacholl and John Martin voted against the motion.

Another work session will be held at 6 p.m. Monday to discuss proposed public safety cuts. The line items from each city department will be on the agenda for approval April 6.

Rocking the Boat

Money laundering, terrorist financing and discriminatory taxation no longer top Europe’s regulatory agenda. ‘Transparency’ is the new name of the game, says Christopher Owen

The year 2008 will remain indelibly etched on the collective psyche of the offshore banking sector. Switzerland and Liechtenstein, the heights of European banking secrecy, were assailed by tax investigations of unprecedented severity while the near collapse of the global financial system injected renewed vigour into international efforts to pierce the offshore veil. Probes into Bernie Madoff’s $50bn fraud look set to pile further opprobrium on opaque investment structures.

The German authorities chose St Valentine’s Day 2008 to call on Klaus Zumwinkel, chief executive of Deutsche Post, seeking evidence that he had transferred millions of euros to a bank in Liechtenstein to evade German taxation. It was to be the first of many such raids across Germany.


The German government said that it had paid an informant €4.2m for a CD containing bank data from LGT Group, the biggest bank in the Alpine tax haven of Liechtenstein. It also said the BND, Germany’s intelligence service, had been involved. LGT, owned by the principality’s ruling family, admitted that the data comprised bank information on 1,400 clients. It had been stolen by a former employee who had “abused his position of trust to compile information about clients”.


The highest proportion of clients, about 600, were resident in Germany but information had also been sold to the tax authorities of the US, the UK, Australia, Canada and France. The German government said it was willing to share relevant data on non-German individuals or entities with other governments: tax authorities in Ireland, Norway, Sweden, Finland, the Netherlands, Italy, Greece, Spain, and the Czech Republic all indicated their interest.


Liechtenstein’s acting head of state Prince Alois, accused Germany of using “draconian methods that defy the rule of law” and failing to respect his country’s sovereignty. “Germany has clearly failed to understand how one behaves towards a friendly state,” he said. But as the investigation snowballed, such a stance looked increasingly untenable.


Liechtenstein has subsequently concluded a Tax Information Exchange Agreement (TIEA) with the US and also indicated its willingness to cooperate with individual EU countries. Reigning Prince Hans-Adam II noted that the process of rethinking should have begun earlier. “I do believe that, with respect to our financial centre, Liechtenstein has always waited until no other option was available, until the pressure from abroad became so great that we had to implement reforms.”


The second seismic case involved Switzerland’s largest bank, UBS. An investigation by the US Internal Revenue Service (IRS) into Igor Olenicoff, a Russian-born property developer in California who pleaded guilty to tax fraud in December 2007, had also brought the name of Bradley Birkenfeld, his private banker, to the attention of the authorities. Birkenfeld, a US citizen, was employed as a director in UBS’s private banking unit from 2001 to 2005. In May 2008, he flew to Boston, from Switzerland, for a school reunion. Arrested as he stepped off the plane, Birkenfeld was later charged with conspiring to defraud the US by creating bogus trusts and corporations to hide some €150m in assets. Birkenfeld, who had been cooperating with US investigators for over a year from Switzerland, entered into a formal plea agreement to reveal what he knew about UBS’s offshore private banking business.


In 2001 UBS had committed, under the US’s new Qualified Intermediary (QI) regime, to provide US tax officials with information on any customers receiving taxable US income. Instead, according to Birkenfeld, it assisted wealthy US clients to conceal their ownership of assets held offshore by creating sham entities and then filing IRS forms falsely claiming that the entities were the owners of the accounts. UBS had approximately €15bn of assets under management in ‘undeclared’ accounts for US taxpayers.


Battle lines were drawn on 1 July 2008 when a federal judge in Miami approved an IRS summons obliging UBS to turn over records on 19,000 US citizens thought to have undisclosed offshore accounts. This was a direct challenge to Swiss bank secrecy. IRS commissioner Doug Shulman said in a statement: “People should take notice that the secrecy surrounding these accounts is rapidly fading.”


Later that month, Mark Branson, UBS’s chief financial officer of global wealth management and business banking, apologised to the US Senate Permanent Subcommittee on Investigations for “any compliance failures that may have occurred” and said UBS would no longer provide offshore banking services to US citizens.


But, on 6 November, the US upped the ante. A grand jury in Florida indicted Raoul Weil, chairman of global wealth management at UBS, on one charge of conspiring to help US citizens hide assets from the IRS to maintain a “profitable’” business for the Swiss bank. Weil, who denies being aware of, engaged in or tolerating any illegal conduct in the operation of UBS’s US cross-border business, was declared a fugitive from US justice on 13 January this year.


UBS currently finds itself torn between US demands for disclosure and the Swiss banking code. Already the ramifications have led to regulatory action: last October the IRS issued new rules, effective from 2010, to tighten the QI regime that allows participating foreign banks to withhold tax overseas on behalf of US clients without disclosing their names to the IRS. Banks will be required to determine whether US investors are behind the foreign accounts they set up and to alert the IRS to any potential fraud they detect, whether through their own internal controls, complaints from employees or investigations by regulators.


Likewise, the Liechtenstein case prompted the EU to strengthen its Savings Tax Directive. Last November, the European Commission adopted a proposal to close existing loopholes and expand the Directive to cover the taxation of interest payments channelled through intermediate structures and to income derived from investments in certain financial and insurance products. 


At the same time, the EU is attempting to extend its geographic reach. The Directive currently applies in 42 jurisdictions: the 27 EU member states, five non-EU ‘third countries’ – Switzerland, Liechtenstein, Monaco, Andorra and San Marino – and 10 dependent and associated non-EU territories – Anguilla, Aruba, the British Virgin Islands, the Cayman Islands, Guernsey, the Isle of Man, Jersey, Montserrat, the Netherlands Antilles and the Turks & Caicos Islands. The European Commission started discussions on applying the Directive with Hong Kong, Singapore and Macao last year. Formal negotiations are expected to take place with Norway, at its request, while Bermuda and Iceland have shown interest in participating. EU tax commissioner Lászlo Kovács said the measures “will ensure a level playing field for financial intermediaries throughout the world.”


These moves are taking place against the backdrop of an ongoing supranational initiative, led by the OECD, to bringing greater transparency to financial centres. In September, the OECD’s Global Forum on Taxation announced that although advances had been achieved, progress on exchange of information on tax issues had been more limited. It said significant restrictions on access to bank information for tax purposes remained in three OECD countries – Austria, Luxembourg and Switzerland – and in a number of OFCs, notably Liechtenstein, Panama and Singapore.


Crucially, after the ebb tide of the Bush administration, the current is now running back in the OECD’s favour. At the emergency summit to address the economic crisis in Washington DC last November, leaders from 21 nations committed “to protect the integrity of the world’s financial markets by… preventing fraudulent activities and abuse, and protecting against illicit finance risks arising from non-cooperative jurisdictions.” At a follow-up meeting in Paris in December, EU finance ministers agreed to collect case studies on non-EU countries and jurisdictions that are not cooperating in combating illegal tax activity, and give them to the Financial Stability Forum, a body set up to enhance global oversight of financial markets and address loopholes. 


The European Commission also agreed to present an action plan for anti-tax haven policy in early 2009. “Non-cooperation mostly refers to areas of taxation,” said EU internal market commissioner Charlie McCreevy. “Primarily the focus is in Europe but there are tax havens all over the globe. There is also a lack of cooperation in regulatory matters.”


Nor can OFCs expect any respite from across the Atlantic. US President Barack Obama made the fight against tax havens a key part of his campaign and as a Senator, in February 2007, he co-sponsored the Stop Tax Haven Abuse Act (STHAA), which 
was introduced in both houses of Congress but not enacted.


The main plank of the STHAA is a provision that would force taxpayers to prove that they do not have control over offshore entities with which they contract. US individuals will be presumed to control any entity – including trusts, corporations, and partnerships – created or domiciled in an offshore jurisdiction if the US person directly or indirectly formed, received assets from or is a beneficiary of that entity. Obama’s aides have indicated that similar legislation will be considered, possibly in the early months of 2009.


There can be no doubt that 2008 was a tumultuous year for the offshore sector and the reverberations will continue to be felt long into the future.


Banking secrecy is facing an assault of unprecedented ferocity and all forms of financial engineering that add opaqueness look set to be targeted. If offshore centres are to survive the backlash, they will have to demonstrate that they add real value to the global economy.

The Future of Tax Havens

Tax havens, or offshore financial centres as they prefer to be known, have long been the bête noire for governments of industrialised nations, who claim they offer illegitimate tax competition and a refuge for tax evaders. And now that governments have sunk trillions of euros into shoring up the global financial system, they will not tolerate money leaking away into opaque jurisdictions.


The extent to which OFCs have become integral to world capital markets and investment flows can be seen from even a casual glance at the City of London‘s Fourth Global Financial Centres Index, published last September.


According to the Index, London and New York lead the field and continue to be the only two truly global financial centres; but Singapore, Hong Kong, Zurich, and Geneva occupy the next four slots.


And other OFCs punch way above their weight — Dublin (13), Jersey (14), Luxembourg (15) Guernsey (16), Isle of Man (19), Cayman Islands (21), Dubai (23), Gibraltar (25), British Virgin Islands (29), Bahamas (35), Monaco (37), Bahrain (43) and Qatar (45). Put into perspective, Beijing is at 47 and Mumbai at 49.


These offshore and niche centres, says the report, continue to grow in importance and are typically low tax environments that specialise in private banking, asset management and wealth management. It notes that the tax environment is now being mentioned as a crucial area of competitiveness.


Speed of decision-making and a coherent regulatory regime are also increasingly seen as important in a centre’s competitiveness; people and infrastructure are also vital.


Even the OECD, which has spearheaded the international drive to stem the flow of capital offshore and bring OFCs into line with regulatory norms, has increasingly recognised that genuine tax competition among sovereign nations should not itself be thwarted, provided that it is accompanied by real transparency and performed on a level playing field.


Last October, it announced the signing of 16 new bilateral Tax Information Exchange Agreements (TIEAs) between OECD members and the British Virgin Islands, Guernsey and Jersey. The BVI signed TIEAs with Australia and the UK; Guernsey and Jersey signed with the Nordic economies — Denmark, the Faroe Islands, Finland, Greenland, Iceland, Norway and Sweden.


These agreements brought to 44 the number of TIEAs since 2000. The Isle of Man has 11, Jersey 10, Guernsey nine, the Netherlands Antilles four, and the BVI three. Bermuda, with three, signed its first bilateral agreement with the US in 1986. Antigua has two, while Aruba, The Bahamas and the Cayman Islands all signed one apiece.


The latest agreements, says the OECD, are a significant extension of information exchange networks in place in these jurisdictions, and show their commitment to implementing standards of transparency and exchange of information regarding tax matters.


The OECD says progress is also being made in other financial centres: Cyprus and Malta have removed the last impediments to a full exchange of information; Belgium has negotiated its first tax treaty with full exchange of information; Bahrain and the United Arab Emirates are implementing the OECD standards; and the government of Hong Kong (China) recently launched a review of its policy on exchange of information.


Now that the market in offshore securitisations and fund registrations has shrunk and the rich flows into bank deposits and financial products can no longer be taken for granted, there must be serious question marks over the futures of OFCs that cannot, or will not, comply. Using them will simply raise too many red flags or attract punitive sanctions.


Andrew Corlett, managing director of Isle of Man law firm Cains, says: “OFCs must come within the circle. Their regulatory systems must stand scrutiny and their tax systems must be comprehensible, not predatory. Information should be available through formal gateways such as tax treaties or tax information exchange agreements.


“If jurisdictions choose to stand outside the ring then they can expect to be targeted. OFCs must be able to demonstrate that they are oiling the wheels of international commerce, not simply siphoning off money.”

Counting the cost of round the world yacht racing

In late December and the first week of January, the single-handed skippers of three round the world race boats took the drastic decision to abandon their yachts in the Southern Ocean: the seriously injured Yann Eliès on the French, IMOCA Open 60, Generali, racing through the Indian Ocean in the Vendée Globe, requested assistance 800 miles from the south-western tip of Australia on 18 December; Dutch solo sailor, Nico Budel, competing in the Portimão Global Ocean Race, issued a MAYDAY on board Hayai eight days later, 240 miles NNE of the Crozet Islands after sustaining severe keel damage, and, on 6 January, a second Vendée Globe competitor, Jean Le Cam on VM Matériaux, requested assistance after the yacht’s keel bulb detached and the boat inverted 200 miles west of Cape Horn.

Happily, all three rescues were successful due to the expertise shown by the global network of Maritime Rescue Coordination Centres (MRCC), the skill of the sailors involved, the support of fellow competitors or fellow mariners and the immaculate seamanship of rescue services local to the incident. While the relief that no lives were lost is immense, little is spoken of the individual responsibilities of a skipper when considering abandonment or the financial implications and moral responsibilities of stepping off a yacht at sea.

There is also growing concern triggered by the astonishing attrition rate in the Vendée Globe (30 boats starting the race and a maximum of 11 now likely to reach the finish line) and the recent carnage sustained by the Volvo Ocean Race (VOR) fleet on Leg 4 between Singapore and Qingdao, that Grand Prix racing yachts risk becoming uninsurable, although some of these dramas may not result in claims against the respective insurers. Furthermore, many believe that the current framework of yacht insurance – a trade littered with archaic phraseology that would be familiar to an Elizabethan deckhand – is unsuited to Formula One offshore racing.

The Notice of Race (NOR) for the Portimão Global Ocean Race is very clear over insurance for competitors: 'Each participating boat shall be insured with valid third-party liability insurance with a minimum cover of €3,000,000 [the same amount required by the Vendée Globe Race Organisation],' states the 14 page document.

However, in a round the world race through predominantly empty oceans, third party damage is most likely to be relevant just after the start of the race, or near the finish when competing yachts are bunched together and non-racing, commercial or private boat-traffic may be present. 'Each individual person taking part in the race shall confirm to the race committee that they have assessed and accepted the risks,' demands the NOR, 'and taken out personal insurance suitable and adequate for their needs having due regard for their circumstances and responsibilities.'

So, third party and personal insurance are a prerequisite for entering a round the world race, but – as is usual when boats are concerned – the situation is far from straightforward. Some race organisers appear to make the assumption that buying such insurance is as easy as buying any other bit of kit for the yacht. In reality however, the availability of anything approaching ‘comprehensive’ or ‘all risks’ type cover, arranged on a correct basis from a securely capitalised source, is anything but widespread, and may indeed be becoming an endangered species.

Richard Power, a Director at Southampton-based Fastnet Marine Insurance Services, is insurance broker for three of the Portimão Global Ocean Race yachts – Nico Budel’s Open 40, Hayai; Jeremy Salvesen and David Thomson’s Class 40, Team Mowgli, and Kazimir Partners, the Class 40 of South African brothers, Lenjohn and Peter van de Wel – explains one of the basic responsibilities of a yacht insurance policy holder: 'If you were anchored in – let’s say - Studland Bay and the wind turned east and you began dragging your anchor. If you simply hopped into the dinghy, rowed ashore, went to the nearest phone box, rang your insurer and told them: ‘The boat is heading for a lee shore and if you get someone here quick enough, it might prevent a total loss,’ you will not get your claim paid,' says Power. 'But if you take every step you possibly can to prevent the boat ending up on the beach, but still fail, you can expect to get your claim paid.

Often, in cases like this, the insurers will apply terminology using the word ‘reasonable’. For example: ‘Were all reasonable steps taken to avoid the situation?’ or ‘Were all reasonable measures taken during the situation?’.'

Although an attractive stretch of the English South Coast is a very different environment from the high latitudes encircling Antarctica, the same principles apply: 'The Budel, Generali and Jean Le Cam situations where they are faced with abandoning a boat could materialise in the English Channel or the North Atlantic,' continues Power. 'In such a location, the possibility of salvaging is very much greater, and therefore the ultimate ‘downside’ faced by the Insurer is reduced. However, the distances you find in the Southern Ocean are a very different matter.' Despite the implementation of ice gates by race organisations to prevent the competing yachts form descending too far south away from the proximity of land, commercial shipping lanes or rescue services, the risks are still high: 'In the Portimão Global Ocean Race or the Vendée Globe or the Velux 5 Oceans, you may find yourself getting off a boat in parts of the world where the option of getting back to land is not available and you have to rely upon those other competitors around you.'

Before Nico Budel activated his EPIRB distress beacon on Hayai at 15:45 GMT on 28th December, he had already advised the Portimão Global Ocean Race organisation that his keel was damaged and a fellow competitor, Michel Kleinjans on Roaring Forty was diverted to assist the Dutch sailor. A week earlier, two Vendée Globe boats – Marc Guillemot on Safran and Samantha Davis on Roxy – were diverted towards injured Yann Eliès on board Generali and shortly after the New Year, Vincent Riou on PRB and Armel Le Cléac’h on Brit Air raced towards Jean Le Cam on his inverted IMOCA Open 60, VM Matériaux. Once Budel issued a MAYDAY, MRCC Reunion diverted the 170,000 ton bulk carrier, CSK Radiance, towards the yacht’s location and although conditions on board Hayai were deteriorating dramatically as the yacht’s keel bulb began to work loose from the keel fin, the Dutch solo skipper remained completely composed: 'He actually asked me, via his son, Frans, what I wanted him to do with the boat,' recalls Power.

'The technical response when a boat is in peril is: ‘You must act as if you are prudently uninsured.’ This is true whether you are in an Open 40, or 150ft superyacht,' he explains, 'but it is not exactly the easiest concept to explain to someone when they are in the sort of predicament that Budel was in.'

With a great depth of experience and knowledge in offshore sailing, this kind of call centre response was not an option for Power. 'In Budel’s case, I told him to do what he felt best for himself and the boat and we’d worry about the rest later.' As broker for Hayai, Power’s work would commence once the Dutchman was rescued. 'When Budel gets ashore, Fastnet Marine Insurance Services have to demonstrate to the insurer that whatever course of action he took was the correct thing to do without prejudicing the insurer’s position.' In other words, Budel took all reasonable steps before, and during, the incident, to try and limit the risks faced by the yacht and, therefore, her insurers. Reality, of course, shows that there was very little he could do to save the yacht, so he had to consider what to do next.

Budel’s decision, with guidance from his insurance brokers, was to scuttle Hayai, opening the sea cocks shortly before climbing cargo netting slung over the side of CSK Radiance. When Yann Eliès was rescued from Generali by the Royal Australian Navy frigate, HMAS Arunta, the French skipper’s sponsor, Generali Group, opted to attempt salvaging the Open 60. However, five days after the rescue, Generali had drifted approximately 200 miles south-east by the time of her last recorded satellite position on Christmas Day, slipping even further away from land and it is likely that the boat now lies on the seabed in around 4-5,000 metres of water 900 miles south-west of Melbourne. For Jean Le Cam, incarcerated, yet also protected, inside the sinking hull of VM Matériaux, the option to intentionally sink the boat was unnecessary before he climbed on board Vincent Riou’s PRB.

'Nico Budel, had to demonstrate that there was nothing that could save the boat,' continues Power. 'Where we come in is to persuade the insurers that this is indeed the case, and waiting for a couple of months for the boat to drift close enough to land for someone to go out and recover it just isn’t a good option.' When practical, there is only one alternative: 'In reality, the most viable option is to scuttle the boat, because if he leaves her afloat, there is a risk that she may become a danger to other shipping,' he confirms. 'The skipper can say: ‘I pulled the seacocks on her because I didn’t want her to become a danger to other ships. I also weighed-up this danger with the possibility of salvaging her and I believed that there was not hope of her being in any fit condition by the time she has drifted across the Indian Ocean’.' With luck, this approach is successful. 'Third party liability is a part of standard yacht insurance policy and includes the liability for removing the wreck and/or salvage,' continues Power. 'When you step off your Open 60 in the middle of the Pacific, you feel more inclined to pull the plug on it and sink the boat rather than try and get it back to land, purely on financial grounds. If you don’t, she drifts around for an indeterminate period of time, unmanned and a hazard to other shipping and, consequently, an ongoing risk for your insurers.'

The devastation sustained by the Volvo Ocean Race fleet in the final week of January during Leg 4 from Singapore to Qingdao produced copious press comment and spectator debate.

Headwinds reaching 50 knots and horrific seas tore through the VOR boats and survival and preserving the boats became paramount. Despite efforts from all crews, three boats suffered severely: Both Ericsson 3 and Telefonica Black developed cracks in the hull and Team Delta Lloyd discovered failure to the bow bulkhead. 'This sort of damage comes under the very old fashioned phrase ‘A Peril of the Seas’,' says Power. 'So, if it’s heavy weather damage, the insurers will pay for that, but structural failure resulting from the yacht being driven too hard as a result – possibly - of competitiveness perhaps eclipsing, to an extent, self-preservation in a bad sea state is a very, very dubious situation from an insurer’s point of view and they may ask why they should be expected to pay for this.'

There is also the issue of a rigid time limit applied in race stop overs. 'There’s no provision in a standard yacht insurance – or even a policy that has been tweaked in this direction – to pay for what is known as ‘The Accelerated cost of Repair’ to get the boat back into race mode. In other words: ‘It’s going to cost x-amount more to repair this, because you need it for the next leg,’ or similar. Insurers will only pay for the ‘reasonable’ - that word again - cost of repairs, and are under no obligation to pay an extra amount that is related to the job being done in a tight timescale.' So, throwing large amounts of money or hired help at the problem to get it resolved super quick, cannot necessarily be covered through insurance alone. 'This must be funded by the team’s budget and carried out by the team’s own repair crew,' he confirms. 'A normal yacht insurance claim can be a very old fashioned and cumbersome process and has no real place in a Grand Prix round the world race where the clock is ticking the whole time.'

With the exceptional fall out rate in the current Vendée Globe sparking debate between skippers, designers, boat builders and the class association as to culpability and the search for a possible solution, the issue of insurance becomes fundamental to the debate. 'The plain fact is that the attrition rate is becoming something that must be confronted and, in isolation, some boats risk becoming uninsurable,' believes Power. 'The old way of insuring the Vendée Globe fleet was to get all the boats together and estimate the value of each boat, then for one French broker to approach an insurance company,' he explains. 'Then factor in the loss of at least one boat. So, with the most expensive boat in the fleet valued at, let’s say, €2,000,000, the whole fleet premium must be €2,000,000 for the qualifiers and the race itself. The Whitbread Round the World Race was the same, but it’s not so easy to do this now. They tried with the Volvo, but the fleet isn’t big enough.'

The solution to this problem is a matter of backscratching: 'The current technique practiced by brokers is to establish relationships with insurers that cover softer boats – big white motor boats – and if you have enough superyachts with them, you might be able to squeeze in a Formula One race boat,' says Power. There also appears to be a general, blinkered misconception that insurance companies will seek a connection with extreme, offshore sailing and cover boats for the sheer kudos of involvement with an event: 'This just isn’t the case anymore,' states Power. 'The insurers have great big motor yachts and they just don’t need to underwrite these boats at all. They are under more pressure than ever to produce and maintain profit, and - from a broker’s perspective - you can only approach an insurer with an expensive racing boat risk if you have fed him a number of more comfortable, superyacht risks.'

Until a resolution is introduced to ensure that some of the very expensive, round the world race yachts stand a good chance of completing a circumnavigation, sponsors and insurers may feel that the returns are too low and the risks are just too high. A viable solution, perhaps, is a round the world race in a fast, robust and relatively inexpensive Class 40.

Sports Boat ASBA National Championship underway at Geelong

After their first two races were cancelled due to strong winds, the Bundaberg Sports Boat ASBA National Championship fleet was eager to get out on the water today. Flat water and blue skies heralded a promising start to day two, helped by a steady 8-10k easterly breeze which held true for most of the afternoon.

With 21 entrants representing every state in Australia, the quality of the Skandia Geelong Week sports boat competition is high. Reigning Bundaberg Sports Boat champion Chris Williams has sold his winning Thompson 7 Team GUE and is 'hitching a ride' this year in Geelong steering John Williams’ T 7 Salsa Lou, the renamed former Geelong Week winner Foam Fast.

Airlie Beach regatta winner Graham Sherring’s Quantum Sails is another hot favourite for this years’ title and Heath Townsend from Dunsborough in Western Australia has been lured back once again, this time racing What Tha, a Melges 24 One Design. Another well-travelled Melges OD is Heath Walters’ Mako Melges from Sydney and Perth sports boat stalwart Steve Battley returns to Geelong for the fourth time.

Former Geelong Week sports boat champion Paul Heyes will crew for Greg Scherwinski on the T7 Ronstan/Ray White, a boat which is literally straight out of the moulds and racing for the first time. Another former winner at Geelong and former National sports boat champion is Julian Newton from Adelaide and his Elliot Espx Game Over and local skipper Cam Rae, well-used to racing on Corio Bay with his Bendigo Private crew, could also feature on the podium when the 8-race series is complete.

Interesting boats in the fleet this year include Top Gear from Tasmania. Royce Salter has completed a magnificent restoration of an insurance write-off which is attracting a lot of attention dockside, along with the distinctive red Bohica from South Australia. Most of the sports boats will follow the eye-catching and extremely quick Bethwaite 8 Vivace around the track. Noel Leigh-Smith and his crew are fresh from their success at the recent Sports Boat Sunday regatta in Brisbane and keen to win, the Australian Sports Boat Association National Championship title along with the famous 'Bundy Blue' Henri Lloyd jackets in Geelong.

Heath Walters’ Mako-Melges took first place on handicap in Race one, edging out John Lloyd’s T7 Salsa Lou with the Egan 6 Quantum Sails from Queensland third. Fourteen seconds separated fourth placed Bendigo Private from the Egan 6 and out of the placings the battle of the T7’s saw Ronstan/Ray White ahead of Bruce Hollis’ Zip and Steve Battley’s Road Warriors. Two Delphia Sport 24’s Splash 1 and 2 enjoyed a great one design battle with only seconds separating the first from the second.

Race two in a slightly lighter breeze saw John Lloyd and Salsa Lou at the top of the list in a lighter breeze with Heath Walters Mako Melges second. Hindered by some crew concerns in race one, Road Warriors sailed far better later in the afternoon to secure third.

A two way tie at the top of the series shows Salsa Lou and Mako-Melges at three points apiece with What Tha snapping at their heels. Three Thompsons locked together ten points away from the leaders will set the scene for another great day of Sports Boat action at Geelong tomorrow.