When Should You Pay?
Monday, July 28th, 2008
“Know the Cons of Chartering the Private Yacht.” This headline, from a blog called Life Info Zone, caught my attention this weekend for obvious reasons. When I read the post, I realized the author does not specialize in private yacht charter vacations–and that some of the key “tips” he or she posted are inaccurate.
The one I’m going to highlight here is the statement that when booking a charter, you must “… be careful with how you pay. Most established yacht chartering companies will request that you pay a deposit upfront, but you shouldn’t have to pay in full upfront.”
That’s just plain wrong. When you book a crewed yacht vacation, you will be asked to pay an APA, which stands for Advanced Provisioning Allowance. This is just what it sounds like: money given to the yacht to allow the crew to provision food, fuel, and anything else you request in advance of your charter. The full balance of the APA, in addition to any balance owed on the yacht’s base rate, are typically due one to three months before your charter’s start date.
There are two primary reasons for this pay-before-you-go arrangement. First is that the crew actually does need time and money to provision the yacht in advance of your vacation. If you’ve requested specific wines, for instance, they may need to have them flown in.
The second reason is that if the full charter rate has been paid into an escrow account, then the yacht’s owner has a strong incentive to do everything possible to keep the charter dates intact. He doesn’t actually get your money until the charter takes place, but your good faith payment serves as a deterrent against his, say, canceling your charter so that he can use his yacht himself.
The only money you would not pay in advance of your charter is the crew’s gratuity, which is left at your discretion upon completion of the charter. Having said that, some higher-end charter clients actually wire the crew gratuity into the escrow account before the vacation, and then release the money (or a portion of it) when their vacation ends. That way, they don’t have to carry a 10 percent to 20 percent cash gratuity for a charter exceeding $100,000.
Posts like the one on the Life Info Zone blog do a disservice to you as a charter client because they create expectations that simply will not be met by reputable charter yachts. Do yourself a favor and stick to yacht-specific websites such as CharterWave for your yacht charter information, and as always, work with a reputable charter broker to avoid any other misunderstandings when it comes to booking your vacation.











