Car Insurance And Trailer Coverage

Posted on: 27 December 2019

If you are planning to buy a trailer for your car, then you should first know how it will affect your auto insurance coverage. Note that your liability coverage, the mandatory part of your car insurance, will only apply to your trailer under certain circumstances. Below are some of the conditions insurance companies typically set for trailer coverage.

Ownership and Registration

Many auto insurance companies will only extend liability coverage to a trailer that you own. This means you might be out of luck if you borrow a neighbor's trailer and end up damaging another person's property while backing out with the trailer. Thus, when you buy a trailer, it is important to do the due diligence so that you can have the legal papers to prove its ownership. If you receive a trailer as a gift, say a birthday gift from your parents, you should have it registered in your name so you have proof of ownership in case of an accident.

Trailer Type

The type of trailer you own also determines coverage since your insurance company may have a different definition of a trailer from you. Many insurance companies only recognize trailers that are purposely designed to be towed by a car. Therefore, anything that goes on top of the car may not be recognized as a trailer. Also, a trailer that has its own motor will require a separate policy; most insurers only recognize trailers that depend on the motor of the lead vehicle.

Trailer Attachment

Some insurance companies will only recognize claims based on trailers if the trailer was attached to the car at the time of the accident. The rationale is that the coverage primarily applies to the car, and the trailer is only recognized by virtue of it being attached to the car. Thus, the coverage might not apply if the trailer causes an accident while it is unattached to the car. 

Usage

Lastly, your auto insurance coverage will only apply to a trailer that you own for private or personal use. The coverage won't apply if you use the trailer for commercial purposes. Therefore, the coverage might not apply if you use your trailer in your delivery business or if you use it to carry people. After all, your personal auto insurance also doesn't apply to your car if you use the car for livery.

The above are general conditions to expect; the exact terms and conditions will vary by policy and insurer. Consider a company like Germain Insurance Agency for further information on trailer coverage.

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