My alarm bells went off when my insured recently told me, “My customer/broker said I don’t need trailer coverage to pull their trailer.”
It’s never wise to accept statements or advice about insurance from anyone other than a licensed insurance agent. And when we’re talking about insurance for trucking, preferably you want an agent who has firsthand experience and knowledge of the trucking industry. Otherwise you could find yourself without the necessary insurance coverage for your trucking operation.
This insured has been doing power-only operations for two different customers/brokers. Neither of them required him to provide “physical damage” coverage for their trailers. While on the surface this sounds great to us truck owners, it comes with a very high risk! That risk is that while a trailer is in the “care, custody and control” of the power-only trucking operator, that operator can still be held liable for physical damage to the trailer.
I emphasized to my insured that while his customers/brokers said trailer coverage was “not needed,” it is almost most certainly “necessary.”
This call I received demonstrated an all-too-common issue among us truck owners. Yes, that includes me as well. As I shared with Overdrive Editor Todd Dills several years ago, I too trusted brokers when they made statements about what insurance requirements had to be met to haul loads for them. At that time, I made the horrible decision to allow customers and brokers to be added to my insurance policy as “additional insured.” Then, once I discovered my error in adding “additional insureds” to my policy, I ended the practice immediately.
[Related: Just say no: One owner-operator's approach to broker/customer demands to be 'additional insured']
