Mandatory Vessel Grounding Insurance

Since 2002, DOBOR has removed 92 grounded or abandoned derelict vessels from State waters at a cost of $2.34 million paid out of the Boating Special Fund.  The Boating Special Fund is entirely funded by fees and charges that boaters pay to DOBOR and is the primary source of funding to support vessel registration and titling, boat ramp maintenance, harbor operations, repairs and maintenance, the boating safety program, removal of abandoned and derelict vessels from State waters, and much more.

There are 389 documented vessel groundings/sinkings in DOBOR’s records since 2002.  DOBOR suspects many more groundings have occurred which have not been reported.

In December 2009, DOBOR instituted mandatory insurance for vessels moored in state boating facilities as a condition of the mooring permit, resulting in a reduction in the number of vessels it has had to remove and dispose of.  However, the number of vessels in  state boating facilities is only a fraction of the total number of recreational vessels that operate in State waters.

Historically, vessels that are trailered and vessels that are housed in private marinas did not have any insurance requirements.  The new grounding insurance requirement is designed to address this issue and relieve stress on the Boating Special Fund.

Below are some frequently asked questions regarding mandatory vessel grounding insurance:

Does the new law apply to my vessel?

Vessel grounding insurance is required for all vessels 26’ and greater in length that are:

  1. Required to be registered with DLNR/DOBOR pursuant to HRS Section 200‑31(a); or

  2. Operated in State ocean waters with a valid documentation number from the United States Coast Guard.

The insurance requirement also applies to vessels under 26’ in length if the owner of the vessel has grounded a vessel of any length anywhere in the state or state ocean waters.

NOTE:

  • The new law is designed to address trailered vessels and vessels housed in private facilities that do not already have insurance coverage.

  • For the purposes of determining insurance requirements, vessel length is the length of the vessel as originally manufactured, and modifications will not be included in the calculation of length.

  • Vessels currently in state boating facilities on mooring or dry-land storage permits should already be compliant with the insurance requirement for use of state facilities set by the Department of Accounting and General Services, Risk Management Office; no additional insurance is required for these vessels.  Commercial vessels (long-line fishing vessels, cruise ships, etc.) are already required to have insurance to occupy space in any State facility and are therefore compliant.    

What is the minimum coverage amount?

No less than $100,000 per occurrence, in a form and content to ensure that removal and salvage of a grounded vessel are covered. 

When will I be required to show proof of grounding insurance?

  • When registering a vessel for the first time,

  • When renewing/transferring registration, and

  • While the vessel is being operated on state waters.  If you are boarded by DLNR enforcement officers, you may be inspected for carriage requirements, proof of certification to operate the vessel AND proof of insurance

What is considered adequate proof of grounding insurance?

Acceptable proof of insurance for registration/transfer is a declarations page from your insurance provider indicating there is $100,000 coverage and that removal and salvage of the vessel is included. 

Acceptable proof of insurance to keep on board during vessel operation is 1) an insurance card, or 2) the vessel policy declarations page.

Whichever form of proof of insurance you provide when registering, or carry aboard when operating your vessel, the proof of insurance must include:

  • Name of insurance carrier and contact phone number,

  • Insurance carrier mailing address, policy number,

  • Insurance effective date and expiration date,

  • Year/make/model/HIN*,

  • Name and address of insured

*A Hull Identification Number (HIN) is equivalent to the Vehicle Identification Number or VIN on an automobile. The HIN of the vessel is stated on the vessel’s Certificate of Number which is equivalent to an automobile’s registration.

Where can I read the text of the law regarding the mandatory grounding insurance?

The full text of the new law is contained in Section 200-13.5, Hawaii Revised Statutes.

What was the legislation that enacted this requirement?

House Bill 1033/Act 094 (2019), passed on April 30, 2019 and signed by the Governor on June 7, 2019.

How did DOBOR gather stakeholder input on this?

The law came about through legislation.  The Legislature held its own public hearings on the bill.

What is the full mandate of the Boating Special Fund?

Section 200-8, Hawaii Revised Statutes:

  1. Operating, maintaining, and managing all boating facilities under the control of the department;

  2. Improving boating safety;

  3. Operating a vessel registration and boating casualty investigation and reporting system;

  4. Other boating program activities; and

  5. Planning, developing, managing, operating, or maintaining of all lands and improvements under the control and management of the board, including but not limited to permanent or temporary staff positions who may be appointed without regard to chapter 76, shall be paid from the boating special fund; provided that any fees collected within small boat harbors shall be expended only for costs related to the operation, upkeep, maintenance, and improvement of the small boat harbors.  The amortization (principal and interest) of the costs of capital improvements for boating facilities appropriated after July 1, 1975, including but not limited to berths, slips, ramps, related accommodations, general navigation channels, breakwaters, aids to navigation, and other harbor structures, may be paid from the boating special fund or from general revenues as the legislature may authorize in each situation.  Revenues provided in this chapter for the boating special fund shall be at least sufficient to pay the special fund costs established in this section.

 

 

This page was last updated 1/31/20.