Quote:
Originally Posted by Descant
There's a lot of speculation here, and it's a great game with no apparent rules, so here goes:
Hackercraft is insured by company A. Sea Ray is insured by Company B. Company A pays for repairs to the Hacker and subrogates against B. There is a bailment situation, so Hacker owner will get his deductible back. The Sea Ray, company B, is insured and there is nothing in the policy that requires a specific person to be driving, so the Sea Ray damage is covered by company B.
Now, follow this. The Sea Ray was purchased with a loan, say for $1,000,000, with 20% down. The boat is totaled, and the bank gets paid their $800,000 as the mortgagee/additional insured. They're happyy--they m,ade money on the loan. The owner bought his lakefront McMansion just before the pandemic for $750,000 and used a HELOC for the down payment on the boat. He can now sell the house (after all, he's done boating) for $2,000,000, pays off all the debt and has funds available to buy elsewhere. Nobody was hurt, nobody loses money, nobody gets a ticket. Ain't this a great country?
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Does the boat owner lose any devaluation?
If he bought the house for $750,000 and sells for $2,000,000 but has to repay the HELOC, and the boat has devalued with the insurer paying the lower valuation... doesn't the boat owner come out short of full profit?
Or am I missing something?