Remember the old waves in AA? Yeah, the ones that were just a mesh scripted to move, and broken hitboxes resulting in them doing almost never doing anything to your ship?
Yeah. Same developer who made those waves made these.
Getting hit by a wave makes your ship recoil (athough in this clip your wave should be tilting to the side when getting hit instead of bending upwards), and also makes it sink a bit in order to recreate that effect when a wave hits and your ship fills with water.