You might not have realised it, but boat insurance is the oldest kind of insurance there is. People have been insuring their boats since the 17th century, and over time a number of standards have arisen. The chances are, though, that youre probably much more familiar with car insurance so the good news is that car insurance and boat insurance are actually very similar.

Basically, there are three situations you can be insured against: your boat (or its cargo) being damaged, your boat sinking, and your boat hitting another. Although few countries make it a requirement that your boat must be insured (considering how many boats sail in international waters), you would be very wise to at least buy the third party insurance, in case you hit a boat that is very much more valuable than your own. You will probably find it quite unnecessary to insure your boat against total loss unless it is very valuable it is mainly practical for large ships, and especially for ones carrying valuable cargo.

As with car insurance, policies come with an excess to discourage small claims for boat insurance, this is usually quite a large sum of money, as the intention of the insurance is to cover you against substantial losses instead of just scratches and dents.

There are also a few kinds of insurance you can buy that are unique to boating, although it is unlikely that you will ever find yourself in need of them. If you get Increased Value insurance, your policy will pay out at your boats market value if it is more than the amount you insured it for only useful if you expect your boat to go up in value. Finally, if youre thinking of sailing into a warzone, you might want to get war risk insurance. Of course, you might also want to get your head checked out, if you know what I mean.

Amanda was 42 when she was given the difficult news that she had ovarian cancer.

The West Yorkshire woman received chemotherapy treatment after diagnosis, but Amanda became one of the unlucky ones. She had a bad reaction to the chemotherapy and because of this she was unable to work.

So when a tax bill arrived in the post for a large sum of money, re-mortgaging her house felt like the right thing to do. The building society with whom she had the mortgage asked her to bring along her life insurance papers to support the mortgage application.

But to Amanda’s surprise, what she thought was a life insurance policy was in fact critical illness insurance instead. She had been paying out 80 per month for two separate insurance policies with Scottish Provident and Norwich Union and had absolutely no idea that those two policies covered her for critical illness.

As a result, Amanda claimed back a staggering 100,000, which paid not only the tax bill but her mortgage as well.

Many of us haven’t got a clue about the exact sum we’re paying on insurance each year or the details of what we are in fact covered for. Not only are we shocked to find out that we are actually covered for more than we in fact realise, but that we’re doubling up by paying for various types of insurance that actually cover the same thing.

You’ll find that it’s areas such as loss of income, legal expenses, theft and death which most often people wind up paying out twice for when there is no need – mainly because they haven’t carefully read the insurance policy or because it has been the case that some insurance has been put on to some policies as an added bonus.

In a recently released Financial Services Authority survey, it shows that car insurance policies also come with added extras like breakdown recovery and legal expense cover. Paying out for these added extras when you do not want them is an easy mistake to make, according to the survey, because you actually have to physically ring the insurance firm and tell the staff that you do not want them before these ‘options’ are removed from your agreement.

Take permanent medical insurance (PMI) for example. Many aspects of this policy cover you for the same things that Payment Protection Insurance covers you for. But few people realise this and so they take out both.

The FInancial Ombudsman is very aware about the situation surrounding insurance duplication. They say that “people often do not realise until they make a claim that they have been paying for a policy that provides very little, if any, benefit”.

Take a look at your Critical Illness Insurance, as this is one area in which you sometimes get cover from your employer. Find out whether you have this type of insurance with your work before you make the purchase on this policy. Do the same with life insurance, because if you have a company pension scheme, life insurance is something you do not actually need. The reason? Because most company pension schemes have a death-in-service benefit. What this means that should you die while you are still an employee at that particular firm, then large, a tax free payment will be made – a payment which could add up to four times your annual salary at the time of your death, or more.

Other types of insurance you might not need includes mobile phone insurance. The consumer watchdogs will tell you this is something that’s often a waste of money because you have to pay the first 50 of the claim and if you already have home insurance, that insurance might provide you with some protection.

Others include car insurance extras such as legal expense cover. If you are a member of a trade union, then you could have some legal cover anyway.

Some companies trying to get people to take out ID theft insurance. A waste of money? The consumer watchdogs think so because if it is the case your ID gets stolen you are only responsible for the first 50 and most of the time the banks are prepared to waive charges.