Austin Lovelace says of this text: "'He first loved us.' This simple yet profound thought is the basis for the hymn. God loved us long before we knew it. We seek God, but already God is holding out a hand waiting for us to take hold of it and be rescued from the seas of life" (Lovelace, Hymn Notes).
Stanza 2 alludes to the scene in which Christ saves Peter from drowning (see Matt. 14:22-33).
Bert Polman, Psalter Hymnal Handbook
The Catechism says that those who know Christ’s forgiveness are “to thank God for such deliverance” (Heidelberg Catechism, Lord’s Day 1, Question and Answer 2). As a result, “With our whole lives we may show that we are thankful to God for his benefits, so that he may be praised through us, and that we may be assured of our faith by its fruits, and so that by our godly living our neighbors may be won over to Christ” (Heidelberg Catechism, Lord’s Day 32, Question and Answer 86).