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Old 01-21-2011, 10:19 AM   #1
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[indent][indent]Two and a half years ago my wife and I bought a new 50' power catamaran. On the fourth day of our transit from Florida to our homeport in Virginia the boat sank when an escape hatch broke loose and the boat rapidly filled with water. The insurance company denied coverage and the foreign builder ignored our plight. We have spent the last 25 months in litigation and are now trying to sell the boat hull.

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Old 01-21-2011, 11:20 AM   #2
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Tell us a bit more about the escape hatch, where was it located? how was it closed and locked? How old was the the boat? what were the sea conditions when the "hatch broke loose" ??

Who was the insurer? what coverage did the policy provide? what brand and model of Catamaran ?
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Old 01-21-2011, 01:18 PM   #3
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I cannot imagine what you are going through, and I also cannot imagine a judge ruling that you lose because the insurance company does not have to honor their contract. That is absolutely chilling, and everybody in the US whose belongings are supposedly protected by insurance coverage should prick up their ears and write to their congressman. I would love to read this ruling by the Georgia judge.

I am a bit confused by the information on National Liquidators. The listing to which you link is for a 2005 Adventure cat, yet your blog says that you bought the boat new in 2008. I also went to the Adventure site and didn't see any mention of a 50' power cat. Was yours the first, last, or did I miss the reference to it on the site?

I see the escape hatch shown on the forward view of the hull on the listing site. Did the boat have waterproof bulkheads between the bow and stern? Were the engines flooded or did they remain above water? Having been in some pounding seas trying to make time in the Baltic several years back I can imagine the force of the water on the escape hatch, but I sure would be angry by this failure. You say that the boat was completely submerged, but was still able to be towed to shore, so it sounds as if it was relatively unsinkable. Maybe that's the last straw in your string of bad luck. Had it sunk and been a total loss, the insurance company would have had no reason to deny the claim, eh? Did your lawyer also sue the surveyor?

I think that I would be so angry over the entire debacle that I would be suing the world! And lobbying my congressman and anybody within hearing range to go after the insurance company, and prohibit the importation of Adventure yachts since they were not willing to stand by their defective product. What is going on with that ruling? That is scary.

You have our sympathy. Please keep us informed.
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Old 01-21-2011, 01:21 PM   #4
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Guy, I have removed the link to your blog about this incident since it seems that its purpose, by name, is to discredit the insurance company you used. I certainly understand your frustrations though. Your post of "has this happened to anyone" is valuable here in that perhaps a good discussion of escape hatches, design and construction, use, and failure may be valuable to other multihull owners here.

Regarding the insurance matter, you sought remedy in the US courts and the ruling was against you, unfortunately. I am sorry for your case. So many times insurance companies are able to "not pay up" because of loopholes. These loopholes are the included in the very reason that numerous cruisers choose to only carry liability insurance rather than count on hull insurance that may never pay up.

I am sorry for your troubles but felt it was inappropriate for us to allow a link to a blog that appears to be in place solely to discredit a particular insurance company. I would suggest that you re-think your strategies regarding disseminating information about your plight. While many of us would benefit from understanding why the courts ruled on the side of the insurance company (what was the loophole? that we should be aware of), we actually don't need to know that it was a particular insurance company but rather what we should keep a lookout for.

You have not posted here before. Even though I've cut your blog link, I'd like to welcome you to the forum and hope that you will, in a way that is helpful to our members, continue the discussion about the incident.

Fair winds,

PS. since I have deleted the link for the above reason, sorry, you may wish to post a couple pictures here of the hatch so that a discussion of the matter may take place easily.

As you can tell--our mod staff is very interested in your situation. I have relocated your link to the boat for sale to our cruiser's market LINK
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Old 01-21-2011, 04:20 PM   #5
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The moderator has asked me to purge all mention of the insurance xcompany by name and I have complied. Here are the answers to many of the questions you have asked. As far as the surveyor is concerned we can't discuss the potential for any further litigation. Here is our really sad story.

In May 2008 my wife and I bought a new 50’catamaran. The boat was two years old at the time, but had never been sold so it was sold by Aventure as a new boat. After a lifetime of working and saving responsibly we thought we had finally earned our dream of retiring to the sea. The plan was to sell our stuff, including the house our kids grew up in, so that we could retire doing what we love most - exploring the reefs of the Caribbean.



We did our homework, read all the books and eventually found a boat that seemed perfect. We had it professionally surveyed and after an extensive inspection the boat was found to be seaworthy and in good working order. We purchased insurance to protect our investment. The day we took possession of the boat and set sail from Fort Lauderdale, Florida for our home in Virginia was one of the happiest of our lives.

Three days later, off the coast of Georgia, on a calm sea, the boat began to take on water. We didn't know why, but quickly discovered there was nothing we could do. As the boat's nose dove toward the water, I tried accelerating, but the boat would not right itself. My stomach lurched with panic and fear as the happiest time of my life turned to the grimmest in an instant. The boat was going down, and fast. We were rescued by the Coast Guard responding to our Mayday call -- something I never thought I would have the misfortune of experiencing. I wondered if I had done something wrong, if somehow I had caused the boat to take on water with a piloting error. The events of the day swam in my mind, a sea of confusion and shock, as we headed for dock. Our boat, completely submerged, was towed to a salvage yard.



When we got the boat above water, it became apparent what had happened. There was a large hole in the hull where a safety hatch used to be. The hatch had failed, delaminating from inside, allowing water to gush into the boat's cabin. I felt some relief at learning it wasn't my fault -- there was nothing we could have done. I was shaken, but felt sure at that point that we would be compensated for our financial losses. We'd done everything right -- inspection, insurance, responsible sailing. We weren't hurt. It would all be okay. We would get another boat. We would find the nerve to go back out on the water. We would live our dream.



Then our insurance company denied coverage, claiming the sinking was due to a manufacturer’s defect. They refused to honor an exclusion in the policy that states they will pay for all damages resulting from a “latent defect.” As defined by the policy, a latent defect is a flaw in the material which is existing at the time of building, but is not discoverable by the “Insured.” Sounds like our situation exactly: How could we possibly have discovered the defective hatch when even a professional surveyor believed the boat was sound?

Over the past two years we have spent a fortune on boat storage and preservation, mortgage payments, and significant legal fees, having been forced to sue both the boat builder and the insurance company. In addition to the financial impact caused by the insurance company’s actions, our emotional and physical stresses have been debilitating.



On October 18, 2010, we received an unfavorable ruling from the United States District Court for the Southern District of Georgia, stating that the insurance company does not need to honor their contract. We are appealing the finding, but we will be forced to sell the boat hull for almost nothing and pay the full mortgage value to the finance company.

I was required to insure my boat under laws that protect banks from financial risk. As a responsible person, I also thought I was protecting my investment and life savings and would have an ally inthe insurance company should the unthinkable happen. Instead, when our dream turned into a nightmare,the insurance company focused their boundless resources on ruining my life and avoiding their contractual responsibilities.



Throughout this ordeal, I have renewed my policy with the same insurance company honoring my legal responsibility to insure the boat while it sits in storage in a boatyard. No other company will sell me insurance for an inoperable hull. The insurance company continues to charge us the same premium for a ruined boat that they did originally. We are currently funding the insurance company's army of lawyers as they destroy our dreams and avoid their legal responsibilities.
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Old 01-21-2011, 05:07 PM   #6
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Guy,

Thank you so much for sharing your story with us. The details are tragic--a million questions go through my mind about the "what-ifs" of your situation.

Sadly, the insurer in such a case can easily point to the boat builder and surveyor when such a defect causes problems. If they could not do so, the insurance premiums would be even higher for all of us. That is no comfort to you, though.

You've had the worst things happen and experience many of cruisers fears-all in one story, amazing. All cruisers make decisions that impact their ability to live their dream--everything has unintended consequences.

I hope you will be able to pick up the pieces and put together a cruising plan that will work for you in your current situation.

Fair winds,
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Old 01-21-2011, 08:51 PM   #7
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Hi Mate, what a drama and it continues. Seems an investment in getting a lawyer to read our insurance policy is probably a good idea! Really, they are so tricky to read that I wonder if its worth the money. I would have thought the insurers would have to pay you and then persue the builder or the surveyer. Mine is a very humble boat but she's got 3rd party insurance only. This type of thing can ruin one's health and in the long run health is the most important.

Good health and good luck,

Pete.
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Old 01-24-2011, 03:38 AM   #8
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[QUOTE=Guyburger;1295605175]
[indent][indent]Two and a half years ago my wife and I bought a new 50' power catamaran. On the fourth day of our transit from Florida to our homeport in Virginia the boat sank when an escape hatch broke loose and the boat rapidly filled with water. The insurance company denied coverage and the foreign builder ignored our plight. We have spent the last 25 months in litigation and are now trying to sell the boat hull.

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G'day Guy. I've been reading this thread since you 1st posted it. 1st/ On a personal note If I could just win the lotto (buy many tickets each/every week) I'd be standing next to you immediately.Am sorry I'm not there. 2nd/ Now to the problem.

Do Not let the hatch out of your hands - for any reason or at any cost. Sleep with it if necessary. Be aware that the 'insurance co' & the mfgrs are no doubt monitoring this site. For that reason I suggest you contact me directly, which you can do using these forums. My profile will give you a start. I will be careful that it is you that contact me & not someone pretending to be you. Much to be said about all of this however this is not the time. Ciao , james.
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