Non-Owned Trailer vs Trailer Interchange
November 25, 2015
Author: Winston Price, Sales Executive
It is a common business practice for trucking companies to use trailers that are owned by others in their day to day operation. The auto liability policy will generally extend coverage to non-owned trailers while they are attached to your covered unit, but damage to the non-owned trailer would not be. There are a couple of ways that coverage for the physical damage could be added to the insurance policy, either by adding a non-owned trailer to your vehicle list or to add Trailer Interchange to your policy.
Non-owned trailer coverage extends over a non-owned trailer while attached to a covered (or scheduled) power unit. It is important that the maximum value of any trailer that you would use be listed on the policy as the value for the non-owned trailer. It’s very important to remember that when covering the non-owned trailer this way that there is only coverage when the trailer is attached to a covered (scheduled) power unit.
Trailer interchange extends to all liabilities for damages while in the carriers possession but requires a written agreement be in force. This means the trailer does not necessarily need to be attached to a covered power unit at the time of the loss. When this coverage is included on your insurance policy, it will pay for direct and accidental loss to the trailer.
The two most notable differences between these two coverages is that the Non-Owned Trailer coverage only responds while the trailer is attached to a covered (scheduled) power unit. So, if you are still responsible for that trailer after your covered unit is no longer attached to the trailer, you could have a gap in coverage. Whereas, with Trailer Interchange, a written interchange agreement would need to be in place for coverage to be in force.
- Holtzman, Bob. “Trailer Interchange and Non-Owned Trailer Coverage.” Western Truck Insurance Services. N.p., 7 Dec. 2011. Web. 25 Nov. 2015.
- Robison, Alan. “Understanding Trailer Interchange and Non-Owned Trailer Coverage.” Network Truck Insurance Services. N.p., 8 May 2014. Web. 25 Nov. 2015.