What is the primary purpose of trailer interchange insurance?

The primary purpose of trailer interchange insurance is to provide liability coverage for an insured carrier who has possession of a trailer owned by a different carrier. This type of insurance is essential in the trucking industry, particularly in situations where trailers are frequently swapped between different trucking companies. It protects the carrier using the trailer against potential liabilities that could arise from damage or loss while the trailer is under their custody, regardless of whether the loss was due to their negligence.

This coverage is critical for maintaining business operations smoothly. It helps in safeguarding against significant financial losses and allows carriers to transport goods without the fear of incurring hefty charges for damage to a trailer that they do not own. By having this insurance, carriers can ensure they are compliant with contractual obligations when they are using another company's trailer.