Why brokers should ask clients about trailers

As pandemic restrictions start to loosen and campgrounds open for the summer, brokers might want to ask home and auto customers if they own trailers.

“It’s up to the broker to find out what type of trailer a customer owns, and then they can best determine whether it should be insured on an auto or property insurance policy,” said Qui Trieu, director of underwriting – auto at Economical Insurance.

For its part, the Co-operators Group Ltd. says the owner of a trailer should add it to their automobile policy for appropriate third-party liability and physical damage exposures.

“When a client approaches us for a quote on auto insurance, we ask the client to tell us which vehicles/risks they need to insure,” a Co-operators spokesperson told Canadian Underwriter. “It may specifically be posed as a question by an advisor or licensed insurance representative as part of their due diligence to review the entire risk and ensure adequate coverage.”

Since the World Health Organization declared COVID-19 a pandemic on March 11, provinces imposed various states of emergency. With Ontario in its second stage of re-opening, more facilities and services are now available at provincial parks in certain regions, the provincial government announced last week.

In Alberta, provincial campgrounds were initially at 50% capacity but all sites are to open for reservations by the end of June, the Canadian Press reports. In Nova Scotia, provincial campgrounds are scheduled to open June 15 at reduced capacity to ensure a minimum of six metres between individual sites, CP reported.

In Ontario, a trailer is considered a separate vehicle that needs a licence plate and vehicle permit issued by the Ministry of Transportation. Alberta also requires trailers to be registered.

But Ontario does not require a trailer to have a separate auto insurance policy, notes McDougall Insurance, a brokerage with offices in more than 30 Ontario communities.

“When the trailer is being towed it receives the same liability coverage that is currently on your auto policy, however, it will not receive any other coverages that you may have associated with your auto policy such as comprehensive or collision coverage,” advises McDougall.

“Across Canada, not all provinces require trailer insurance to be carried separate of a customer’s auto insurance policy,” said Trieu. “With this considered, it’s always best for a customer to speak with his or her licensed insurance broker to discuss options. It’s most important for Economical to know whether a customer has a trailer if it’s being used for commercial purposes.”

In Manitoba, crown corporation MPI has a monopoly on auto insurance. MPI warns that its all-perils coverage does not cover the contents of any vehicle or trailer, such as tools, clothing or a camera.

Feature image via iStock.com/CasarsaGuru