Every freight broker certificate of insurance reviewed in a recent audit at one trailer leasing company failed to cover the leased trailers themselves, according to Andy Kuchar, president of Centerline Insurance Company.

That 100% failure rate — drawn from a single leasing company's onboarding files — has prompted Centerline to warn that the gap could leave brokers personally liable when a leased trailer is involved in a crash, and could pull leasing companies into post-accident litigation for the first time.

"Every single certificate of insurance that those freight brokers had did not cover those trailers and they didn't know it," Kuchar said. The brokers had cleared the leasing company's onboarding process, but compliance staff — not insurance specialists — had accepted documentation tied to commercial auto policies never designed to cover leased trailer fleets.

What does the audit change for brokers?

The exposure sits at the intersection of two distinct risks, Kuchar outlined. First, maintenance obligations typically fall on the lessee, meaning a brake or bearing failure that causes an accident — something Kuchar said he personally witnessed twice on Interstate 24 near Chattanooga — could trace directly back to the broker. Second, providing equipment moves a broker out of the role of pure transportation arranger, adding a layer of legal exposure that arranging-only brokers do not carry.

"The last thing you want, I think, is that — is to have an accident, the leasing company gets pulled in, you get pulled in, and only then you find out you're actually not in compliance with the lease," Kuchar said.

Why contingent policies fall short

Kuchar urged brokers to avoid relying on motor carrier commercial auto policies, even when named as additional insureds. Carrier policies often require every trailer VIN to be listed, and a leased trailer's VIN will not appear on the carrier's policy. Premium-financed carrier policies can also lapse without the broker's knowledge.

He said brokers should instead obtain a dedicated policy specifically designed for the trailer-leasing exposure, and cautioned that any policy containing the word "contingent" warrants close scrutiny of its exclusions and conditions. Contingent policies are cheap, he noted, for the same reason a $25 U-Haul damage waiver is cheap — low limits and narrow coverage.

Where the litigation tide is moving

Kuchar also flagged leasing companies themselves as an emerging risk category. In the three to four months prior to the interview, Centerline had issued roughly a half-dozen policies to protect lessors directly — not just the brokers leasing from them. He tied the trend to post-Montgomery ruling litigation, in which courts have increasingly sought to extend liability to shippers, brokers, and now equipment lessors.

Leasing companies typically operate on five-year contracts, meaning insurance compliance must be re-verified at every annual renewal — a process that can fall through the cracks when compliance staff manage hundreds or thousands of client files.

What brokers should do now:

• Obtain a dedicated trailer-leasing policy rather than rely on a carrier's commercial auto coverage
• Scrutinize any "contingent" policy for low limits and narrow exclusions
• Maintain a documented trailer maintenance schedule, since visual driver inspections cannot detect imminent bearing failures
• Re-verify insurance at every annual lease renewal, even if compliance teams are stretched

For Kuchar, the gap between broker activity and broker coverage is the next fault line in a freight industry still adjusting to the Montgomery decision. With lessor-side policy issuance already running at roughly six policies in the past three to four months, expect that line — and the brokers standing on it — to come under closer scrutiny before the next major jury verdict.