Texas General Lines — Property and CasualtyPersonal LinesMedium
A homeowner has a standard HO-3 policy. They want to add coverage for their boat, which is 20 feet long and powered by a 50 HP outboard motor. Which endorsement or separate policy would be most suitable?
- AA separate Yacht Policy
- BPersonal Articles Floater
- CPersonal Property Replacement Cost Endorsement
- DWatercraft Endorsement (HO 24 75)
Show answer & explanationAnswer & explanation
Correct answer: D. Watercraft Endorsement (HO 24 75)
A standard HO-3 policy provides very limited coverage for watercraft. The Watercraft Endorsement (HO 24 75) to the homeowners policy typically covers small boats (under 26 feet, under 50 HP for outboards) for liability and physical damage. A separate Yacht Policy is usually for larger, more powerful vessels.
Why the other options are wrong
- A. A Yacht Policy is generally for larger boats (typically over 26 feet or with higher horsepower) with broader navigation limits and specialized coverages.
- B. A Personal Articles Floater covers specific valuable personal property (jewelry, art), not watercraft.
- C. This endorsement changes how personal property is valued, not what types of property are covered.
Watercraft Endorsement (HO 24 75)
An endorsement that can be added to a homeowners policy to provide liability and physical damage coverage for certain smaller watercraft that exceed the very limited coverage of the base HO policy.
- Typically covers boats under 26 feet in length.
- Motor limits often apply (e.g., 50 HP for outboards, 25 HP for inboards, or sailing vessels).
- Provides broader coverage than the minimal coverage found in the base HO policy for watercraft.
Memory trick: Small boats get an HO add-on, big boats need their own policy.