Make sure you are covered for consequential damage. That's damage incurred as a consequence of wear and tear, rot, corrosion and all those other previously mentioned common exclusions. Consequential damages are often a result of catastrophic events, which include damages specifically from fire, explosion, sinking, collision or stranding. Think about it: These are the types of losses that are going to cause significant damage to your boat and might even result in a total loss. If you don't get this and your boat sinks or catches fire due to a part or piece of equipment that just plain wore out, you will be stuck with eating the loss rather than the insurance company compensating you.