Jackson said the loss would be felt across the wider district.
"It is a huge loss to the tourism industry and the whole Glenorchy community as he did so much here."
He is survived by his wife, Deana Insley, and family. The Insleys own High Country Horses, Glenorchy. Its website says Insley was orginally from the central North Island and a family of shepherds and musterers.
He came down south to work on the Routeburn Station in 1997 and is also a digger driver. Queenstown Lakes Mayor Jim Boult said on behalf of the district he was shocked and horrified to hear of the accident.
About 45 boats are competing in the week-long event which has legs planned on Glenorchy's Dart River and Queenstown's Frankton Arm next weekend.
Insley was joined by four other Queenstown competitors at the event.
The New Zealand Jet Boat River Racing Association was unable to give details but confirmed the accident occurred in the braided river section about 10 to 15 minutes above the area known as "the pylons".
Insley was navigating the course on a CX21 boat. Spokesman Paul Mullan said racing had lost a family member.
"It [jet-boating] is a very small community and any loss is devastating but when it is in among a group who know each other it is particularly difficult."
He also confirmed jet-boat driver Dwayne Terry escaped injury but was examined by paramedics.
Maritime New Zealand said police were leading the investigation on behalf of the coroner, as it was deemed a fatal accident.
As a mark of respect, racing was cancelled for the remainder of the day. Teams are expected to resume competition tomorrow south of Christchurch on the Rakaia River.
