Many products are marketed with the phrase “Just add water,” implying simplicity. For marina operators, however, water adds significant complications to their risk profile.

Marinas have all the usual risks associated with a property owner and business operator – physical perils, third-party liability for personal injuries and other damage, regulatory compliance and more. But additional risks come with being located at water’s edge – those waters and adjacent wetlands are subject to strict environmental regulation.

Many marinas operate fueling stations and waste pump-out facilities. These can lead to environmental liability exposure under statutes such as the Clean Water Act and the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA). To encourage marina operators to install and maintain pump-out facilities, Congress passed the Clean Vessel Act in 1992, which provides grants to public- and private-sector operators through state agencies that oversee the program. Such facilities are critically important for mariners to comply with the Clean Water Act, and in some respects can be seen as a public service. But as with any storage system for waste or hazardous substances, there is a risk of release into the environment and, with that, significant liability exposure.

Environmental concerns for marinas are not confined to water pollution. Thirty-six states operate a voluntary Clean Marinas program that encourages businesses to adopt practices that minimize their environmental impact. These include waste management, storm water control, spill prevention and emergency preparedness. It is prudent to keep an eye on voluntary compliance programs, since they can develop quickly into compulsory programs, complete with fines, penalties and potential civil liability exposure as well. An example is open ocean ballast water exchange.

Another risk that marina operators are beginning to see is a movement to prevent the spread of invasive species. Increasing public awareness and government actions are putting pressure on boat ramp owners and operators to inspect and prevent from launching any motorized watercraft that do not comply with inspection requirements. For example, the Tahoe Regional Planning Agency has implemented an Aquatic Invasive Species Ordinance, which imposes obligations on boat ramp owners and operators to inspect, decontaminate and/or prevent contaminated vessels from launching in the waters of Lake Tahoe (TPRA Code of Ordinances 63.4.2)

Invasive species are troublesome for ecological, economic and health reasons. According to the National Oceanic and Atmospheric Administration, an estimated 50,000 non-native aquatic and terrestrial species have been introduced into the United States. The invasive species usually face few predators, reproduce quickly, alter habitats and consume native species, in some cases resulting in extinction. Zebra mussels, for example, are cited as causing more than $5 billion in economic losses in the Great Lakes region between 2000 and 2010. Zebra and Quagga mussels, also found in the Great Lakes and other waters, aggressively filter plankton, depriving native species of a natural food source, and clog water intake pipes. These mussels are among many exotic non-native aquatic species and microbes harmful to human health that ships transport in their ballast water. NOAA estimates that 10,000 marine species around the world are carried in ballast water every day. Conservationists recommend that boaters use a strategy of Clean, Drain and Dry every time they remove their vessels from a body of water, to prevent the spread of invasive species.

Environmental pollution and invasive species are not the only risks that marinas face. In addition to traditional property and liability exposures such as fires and slips and falls, a growing concern is electrocution.

Lighting, boat elevators and other waterside electricity can cause tragic incidents in swimmers, ranging from electric shock to drowning. This is especially so when an alternating current is conducted by fresh water. These horrible events are sufficiently common to have acquired their own acronym, ESD, which stands for Electric Shock Drowning.

Where federal admiralty law applies, a marina's duty as a wharfinger to provide a safe berth and safe approach can give rise to claims arising out of dangerous conditions, including those beyond the boundaries of the marina property itself. While this potential source of exposure has not yet generated headlines in the context of pleasure craft marinas, all it will take to change that is a large loss arising out of an unsafe berth or approach, coupled with an uninsured or underinsured boater.

For insurers that underwrite marina operators’ property and liability exposures, risk mitigation requires a thorough understanding of the dynamics of the marine environment and appropriate use of insuring agreements. Consulting with experienced maritime counsel is a wise way to navigate marina risks.