Trailer Interchange Agreement: What It Means, How It Works

What Is a Trailer Interchange Agreement?

In the complex world of interstate shipping logistics, a trailer interchange agreement is a contract that covers the transfer of goods en route to their destination when hauled by truck drivers working for different companies.

Most companies contract out their shipping and delivery to third-party companies, which handle all the logistics.

This agreement is common when semi-trailers transport goods over long distances.

Understanding the Trailer Interchange Agreement

Large companies today do not handle their own shipping and delivery. They contract it out to third-party transport companies, which handle all the logistics. These companies have access to truck fleets that transport goods from origin to customer.

Each delivery fleet works within a set region or network. If a package is picked up in one network but headed to another, transport companies use a trailer interchange agreement to complete the delivery.

The agreement outlines the companies involved, the transfer location, and transport fee.

Truckers often switch trailers to meet scheduling needs across the transport network. For example, a trucker regularly drives from Los Angeles to Denver. If a trailer from Los Angeles is bound for Chicago, the company must arrange for the transfer in Denver for the final leg of the trip.

The same trucker may pick up another trailer before returning to Los Angeles. A trailer may switch between companies and drivers on its way across the country. Trailer interchange agreements simplify and make the process more efficient by not requiring a single trucker to drive the entire distance.

Insuring a Trailer Interchange Agreement

A trailer interchange agreement makes the trucker responsible for any physical damage to the trailer. Businesses involved may require truckers to have trailer interchange insurance.

This insurance covers physical damage to the trailer while being hauled by a party other than the owner. It also covers damage to the truck caused by fire, theft, vandalism, or collision.

Key Takeaways

• Shipping logistics companies work with trucking companies that deliver in specific regions of the U.S.
• A trailer interchange agreement details when and where a truck driver transfers a trailer to another driver for the next destination.
• While en route, a trailer may transfer several times to multiple drivers.

Alternatively, a company can purchase non-owned trailer physical damage coverage, which applies even without a written trailer interchange agreement.