It's not enforceable, I guess. Nobody's out there, actually enforcing it.
The other thing with vessel insurance is that it's extremely costly. Even just for a crappy little tin boat, you have to pay up front for the whole year. It's definitely a huge barrier with vessel insurance, as well, that you can't pay a monthly fee for any vessel of any size. It's up front and you have to pay it that day. Otherwise, you don't have insurance.