First off, you are insuring the boat trailer against physical damage. In simple terms, this means your trailer is protected against fire, theft, vandalism, collision, and other perils covered by your boat insurance policy.
It is equally important to understand what your boat insurance policy is NOT providing coverage for when you insure your trailer.
You are not getting liability coverage while your boat is being conveyed on the trailer or while the trailer is being towed without the boat. As an example, let’s say you are trailering your boat on Highway 95. The trailer gets un-hitched while riding over rough terrain. You can only watch in the rearview mirror as your trailer takes a different route and crashes along with your boat into a parked RV.
For insurance purposes the accident is split into two losses. The first is the damage to your boat and trailer. The second is the damage to the property of others, in this case the parked RV.
The damages to your boat and trailer are covered by your boat policy, but who covers the ensuing damage to the RV? Or the injuries to anyone inside the RV?
The answer may surprise you - it is your automobile insurance company. We’ll explain why after another example, this time one with a twist. About two years ago we received a call from a client whose boat trailer was parked in his driveway. Somehow it rolled out of the driveway and out into the street where it crashed into a parked car.
We advised the insured to report the loss to his personal auto insurance company. Believe it or not, the damage caused by his boat trailer to the car was covered by his auto policy. Most personal auto policies include an owned trailer as an extension of the owned automobile and thus provide liability coverage for a boat trailer.
I hope this information helps you understand what kind of coverage you have for your trailer!