Renting out your boat to others along the Rhode Island coast might seem like a simple way to earn extra money. However, it creates several legal risks under admiralty and maritime law.
Understanding these risks can help you avoid serious consequences and remain compliant with strict regulations.
Injury liability
If someone gets hurt while renting your boat, you could face responsibility for damages. Even if the renter causes the accident, you might still face claims for failing to maintain the vessel or for allowing an unqualified operator to use it. Rhode Island boat owners must ensure that their vessels are seaworthy and that all safety equipment meets U.S. Coast Guard standards.
Damage to your property
Another legal issue involves damage to the vessel. If the renter causes harm to the boat, you might struggle to recover the full cost of repairs. A well-written rental agreement can help limit losses, but it cannot remove all risks. You should make sure the vessel’s insurance policy covers rental use. Many standard policies exclude coverage if someone outside the household uses the boat for profit.
Insufficient documentation
Operating a rental business without the correct documentation can also lead to legal trouble. If a rental creates a “passenger-for-hire” situation, federal regulations may apply. These include stricter inspection standards, crew licensing requirements and safety equipment rules. Allowing someone to operate a vessel as a bareboat charter may seem like a workaround, but it still carries legal implications. If you stay too involved in the trip, courts may reject the charter and treat the situation as an illegal passenger operation.
Before offering a boat for rent in Rhode Island waters, be sure to understand your duties under federal maritime rules and local boating laws. Even a short rental can expose a vessel owner to major legal and financial risks. Using proper contracts, verifying insurance and following all safety rules can reduce some of these risks, but full protection requires careful planning.