Yacht Charter Security Deposit: How It Works and How to Reduce It

The charter price is paid weeks before the trip. The security deposit is paid at the base, on the day, and for a bareboat it is often a sum that comes as a shock: several thousand euros blocked on a credit card before the lines are cast off.

It is not a fee. Properly handled, you never pay it. But understanding what it is for, and what the alternatives are, changes how you book.

What the deposit covers

Every charter yacht is insured by its owner. The deposit is the excess on that insurance: the first part of any claim that the charterer, not the insurer, pays. If a fender is lost, the cost comes out of the deposit. If the boat is run aground and the keel is damaged, the deposit is the most the charterer pays and the insurer covers the rest.

It also covers the smaller things that are not really insurance claims: a broken winch handle, a stained cushion, fuel not topped up on return, a late check-in that costs the base a turnaround.

The amount is set per boat and rises with the boat’s value. A small sailing yacht may carry a deposit of a couple of thousand euros; a large catamaran or motor yacht, several times that. It is stated on the listing and in the contract, so there should be no surprise at the base.

How it is taken and returned

At check-in the base takes a pre-authorisation on a credit card for the full amount. It is blocked, not charged: the money leaves your available limit but does not leave your account. Some bases accept cash or a bank transfer; a few require it.

At check-out the boat is inspected. If nothing is wrong, the block is released, usually within a few working days, occasionally up to a couple of weeks depending on the card issuer. If something is wrong, the base deducts the cost of repair and releases the rest, with an invoice.

Two practical points. First, the block needs a credit card with enough limit; a debit card may not work and a blocked debit card ties up real money. Second, if the card is in one person’s name, that person must be present at check-in.

When a deposit is kept

Most deposits are returned in full. When they are not, it is usually for one of these:

• Damage from grounding, collision or a mooring gone wrong, the most common and the most expensive.
• Lost or damaged equipment: fenders, dinghy, outboard, cushions, boat hooks.
• Fuel and water not refilled when the contract requires it.
• Extra cleaning after a boat is returned in a poor state.
• Late return, which can cost the base the next charter’s check-in.

The way to protect yourself is a thorough check-in. Photograph every scratch, test every piece of equipment and have the base note anything already damaged on the inventory before you sign it.

Two ways to make it smaller

A damage waiver. Many operators offer a non-refundable fee paid at booking that reduces the deposit to a fraction of the full amount, sometimes to zero. The fee is typically a small percentage of the charter price. You pay it whether or not anything happens, and in return the blocked sum, and your maximum liability, drop sharply. For a bareboat crew on a card with a modest limit, this is usually worth it.

Deposit insurance. Third-party policies insure the deposit itself: you pay a premium, the full deposit is still blocked at the base, and if the operator keeps some or all of it, the insurer refunds you. It costs less than a waiver but does not reduce the card block, and claims take paperwork.

Both have exclusions. Gross negligence, sailing under the influence, sailing outside the permitted area and damage from racing are usually excluded from both, as are lost personal belongings.

Skippered and crewed charters

With a professional skipper aboard, the deposit is usually much smaller or waived, because the operator’s own crew is responsible for the boat. On a crewed charter it is common for there to be no deposit at all, with an advance provisioning allowance for expenses instead. This is one of the less obvious arguments for a skippered booking.

Frequently Asked Questions