Last Updated: May 31, 2024, 7:09 am by TRUiC Team

Water Taxi Service Insurance

Getting insurance for your water taxi business is essential.

Water taxi businesses need to protect themselves against a variety of different foreseeable risks, such as those that relate to property damage, maritime collisions, and personal injuries. 

For example, a customer could get injured while in your water taxi, or one of your employees could cause damage to another watercraft after colliding with it.

We’ll help you find the most personalized and affordable coverage for your unique business. 

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Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.

Best Insurance for a Water Taxi Service

General liability insurance is — generally speaking — one of the most important insurance policies for water taxi businesses. 

Some of the risks general liability insurance covers are:

  • Bodily injury
  • Property damage
  • Medical payments
  • Legal defense and judgment
  • Personal and advertising injury

Even so, you may benefit from purchasing additional coverage; this is because a general liability policy may not “fully” protect you from all risks associated with running a water taxi business.

Additional policies worth considering include: 

  • Marine liability insurance
  • Workers’ compensation coverage
  • Commercial property insurance
  • Business income insurance

You will also need to decide what type of coverage provider you will use; there are two options available for small business owners: 

  • Traditional brick and mortar insurers (e.g., Nationwide, Hiscox, etc.).  
  • Online insurers (e.g., Next Insurance, Tivly, etc.). 

All in all, we recommend going for an online insurer as a small business owner. This is because you should be able to find personalized coverage at a much more affordable rate due to the lower overhead involved. 

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Cost of General Liability Insurance

On average, water taxi services in America spend between $450 - $1,000 per year for $1 million in general liability coverage.

Compare the average cost of general liability insurance for a water taxi service to other professional industries using the graph below.

Several factors will determine the price of your policy. These include your:

  • Location
  • Deductible
  • Number of employees
  • Per-occurrence limit
  • General aggregate limit

You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.

A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.

Graph showing average price of general liability insurance prices per industry

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Find the Best Rate

Discover the best coverage at the lowest rate in our low-cost business insurance review.

Common Situations That General Liability Insurance May Cover for a Water Taxi Service

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Example 1: During a tour, water sloshes onboard and a guest slips and falls. The customer believes the driver was steering too aggressively and sues for medical injuries. General liability insurance would cover the legal costs to fight or settle the claim.

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Example 2: One of the employees spills a cocktail on a guest, damaging their designer clothes and expensive handbag. General liability insurance would cover the costs to replace the customer’s property.

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Example 3: The logo you use for your water taxi service is similar to that of another tour company. The tour company sues for lost business and copyright infringement. General liability insurance would cover the costs associated with fighting the lawsuit or settling out of court.

Other Types of Coverage Water Taxi Services Need

While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:

Commercial Property Insurance

You’ll need commercial property insurance if you own an office or official retail space where customers can gather prior to the outing. This insurance covers not only the structure but also the equipment you use. Typically, commercial property insurance protects against natural disasters, criminal activity, and fires.

Workers’ Compensation Insurance

All water taxi workers will need workers’ compensation insurance in case they’re injured on the job. This insurance will cover sudden accidents (e.g., slips and falls onboard) and chronic injuries (e.g., chronic shoulder pain from steering the vessel).

Business Interruption Insurance

Your business is dependent on your ability to operate your vessels. If those vessels are unfit for passage due to a covered event, you can rely on business interruption insurance to supplement your income while the taxis are under repair.

Commercial Umbrella Liability Insurance

You can think of commercial umbrella insurance as an extension of general liability insurance since it can only be used when a general liability policy has reached its limits. Because lawsuits can tie up a business’ time and money for months at a time, this insurance can cover expenses associated with a particularly egregious claim against you.

Liquor Liability Insurance

If you serve liquor onboard, this insurance protects your business from expenses associated with an inebriated guest. For example, if a guest becomes too intoxicated to walk and they stumble into another guest, you may be held liable for any injuries that result from the fall. This insurance can help pay for any damages that result.

Additional Steps To Protect Your Business

Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.

Here are several things you can do to better protect your water taxi service:

  • Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
  • Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
  • Stay up to date with business licensing.
  • Maintain your corporate veil.

Water Taxi Service Insurance FAQ

Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.

A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.

"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.

We recommend purchasing your business insurance coverage before you start your water taxi business so that you are covered before you begin interacting with clients. 

This can save you tens of thousands of dollars in the long run by ensuring that you avoid a situation where you need to rely on coverage that you do not have. 

Not necessarily. Certain exceptions may be written directly into your water taxi service insurance policy, and some perils may be entirely uninsurable.

Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.

An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.