Freight Brokers Face Critical Insurance Gaps on Leased Trailers

Freight brokers managing trailer pools face a structural risk that many fail to recognize: their existing insurance policies often explicitly exclude coverage for trailers in active use on the road. Centerline Insurance Company's entry into dedicated trailer liability coverage five and a half years ago exposed a widespread problem—major carriers were issuing inexpensive policies that provided virtually no protection for the broker's primary exposure. This gap is particularly acute in the post-Montgomery legal environment, where plaintiff attorneys increasingly bypass small carriers and target brokers directly due to their deeper financial resources, making equipment owners and lessors attractive litigation targets even for relatively minor incidents. The financial stakes are substantial and escalating.

While property-damage claims might appear modest on the surface—averaging under $2,000 in some legacy programs—associated bodily injury payouts routinely reach $50,000 to $100,000 or more as claimants pursue ongoing treatment. A single worker fatality during trailer unloading can pull a trailer lessor into multi-million-dollar litigation. Today, even successfully defending against a claim typically costs a minimum of $100,000, making the absence of robust trailer-specific coverage a direct threat to broker profitability and solvency. For supply chain and logistics professionals, this article underscores the importance of rigorous insurance audits and the need to move beyond passive reliance on certificates of insurance or generic commercial policies.

The red flags Kuchar identifies—particularly any policy language containing the word "contingent" or reliance on motor carrier certificates with no conferral of rights to the certificate holder—require immediate attention from compliance and risk teams. The surge in master trailer-liability programs signed by leasing companies in recent months suggests the industry is gradually adapting, but many brokers remain dangerously underprotected.