Is a liability loss arising from the use of a sailboat in a racing competition covered under the watercraft liability endorsement of a homeowners policy?

In this context, the coverage under a watercraft liability endorsement of a homeowners policy typically includes certain types of watercraft use but may have limitations based on the context of that use. Generally, liability arising from activities that are considered deliberate, competitive, or commercial, such as racing, is excluded from coverage. In many homeowners policies, specifically under watercraft liability, there is a common exclusion for loss or damage sustained while participating in racing competitions.

Therefore, liability losses from using a sailboat in a racing competition would not typically be covered under the watercraft liability endorsement. This is because competitive sailing is considered a high-risk activity that goes beyond normal usage of a leisure craft.

The correct answer reflects this understanding, emphasizing that this activity is typically outside the protection offered by standard homeowners insurance when it involves competitive racing.