If you are a broker selling personal lines business, and looking to expand your revenues, there is a niche and profitable market in selling pleasure craft insurance. But with any niche market it takes some research and planning and patience to add a new product to your suite of services.
Boat purchases and boating activity is on the rise
Now is a great time to get into the boat insurance business. There are many facts that support boat activity is on the rise in Canada and is trending up since the pandemic hit. In the first quarter of 2021 over 3800 Canadians got a Pleasure Craft Operators Card. According to National Marine Manufacturers Association of Canada Recreational boating in Canada:
- Has a GDP impact of $5.6 billion and $10 billion in total revenues
- More than 85 percent of boats in Canada are under 26 feet and towable
- There are an estimated 8.6 million recreational boats in Canada
- Boating is primarily a middle-class lifestyle as 59% of Canadian boat owners have a household income less than $100,000.
Covid-19 has changed and influenced boating behavior. According to a survey done by Sea Tow Services International a surveyed reported the following:
- 52% of boaters anticipate boating activity to increase this summer compared to last.
- 24% plan to vacation on/by boat (versus other forms of travel) because of the pandemic.
- 35% plan to use their boat primarily for cruising near their home.
- 16% upgraded to a larger boat in 2020 or plan to do so in 2021.
- 52% plan to use their boat primarily for fishing (65% in-shore / 30% off-shore / 5% freshwater).
Building your business is about planning
Insurance is all about risk, and if you want to grow your brokerage business, you must be prepared to take some, because with any change comes some level of risk. Boating is seasonal and also has cyclical revenue streams. But we can help mitigate that risk by giving you the steps to take to have boat insurance as one of your main product offerings:
1. Evaluate your current book of business. Is there opportunity to cross sell or use the base for reference.
2. Are you close to a marina and if yes what type of boats are typically moored? High value boats, cruisers, sail boats, water sport boats.
3. Choose to work with experts, such as Pacific Marine – who only have dedicated marine underwriters.
4. Is the underwriter familiar with the geographical location the broker wants to target?
5. What type of market would you want to go after? High value cruisers, cottage/day boats.
6. Set up a dedicated team in the brokerage and train them in pleasure craft insurance. PMU has a credited training program.
7. Create the expertise and compliment it with a dedicated marine page on your website and a dedicated phone line for boat insurance.
8. Follow marine market news to stay up to date on changes and news. Join boating communities.
9. Create a marketing plan for cross-selling, referrals and new business. Engage in social media and have a budget for your marketing plan.
10. Follow your progress on a weekly basis during boating season.
In Canada, there is certainly a slow season to the boating business, and during the winter months is a time to regroup and refocus your efforts on what worked for your brokerage. Adding a new product line takes time to build, but recreational boating stats show there is no slowing of boat activity for years to come. Become a PMU broker partner and sign up for a broker tool kit. Ask us how.