Having only a few options for sail colors means you can't build as much notoriety with flying colors that strike fear in an enemy. The ability to buy and customize at a level that it will be very rare to see two sails alike will make for more personal expression.

Also the current faction sails in game could give a small bonus when turning in items for that particular faction.

Also why don't we have jolly rogers to raise for a threat of "no quarter"?