Are Trailers Covered by Car Insurance?

Whether you’re hauling out the tinny for a weekend on the water, heading to the hardware store to stock up for your next DIY project, or packing up for a long-awaited family camping trip, you might turn to a trailer to help you get the job done.

But, as you pull out of the driveway, a question may start to niggle: Does your car insurance cover the trailer you’re towing?

From flatbed trailers and boat trailers to camper trailers and even caravans, Aussies tow all sorts of trailers for work and leisure. However, when it comes to insurance, it’s not always entirely clear how it all works. Or if insuring your trailer is even a compulsory requirement.

​​“Generally, you don’t need Compulsory Third Party (CTP) insurance for a trailer – it’s usually covered by the towing vehicle while it’s attached,” explains Marni Jackson, Youi’s Head of Product – Vehicle and Lifestyle.

“But it’s important to note that once it’s unhitched, that cover may not apply, so separate trailer insurance could be worth considering if you regularly use a trailer for work, camping or travelling.”

To help you explore your options, whether you’re thinking about buying a trailer or caravan or you already own one, we’ve put together this handy guide on car and trailer insurance.

Are trailers covered under car insurance?

Yes, they can be, depending on what you mean by “covered”.

As Jackson notes, it’s likely that your trailer is automatically covered by the CTP insurance policy of the vehicle towing it, although it’s probably a good idea to check with your CTP or Green Slip insurer to be sure.¹

But, while your CTP insurance is there to cover you for injuries to other people or fatalities caused by your car – or your trailer while it’s being towed – it doesn’t cover any damage to property, including to your own caravan or trailer.²

That’s where other types of car insurance might come into play,² as long as your policy specifically states that trailers and caravans are covered.³

How Youi car insurance covers your trailer

“At Youi, regardless of your level of car insurance, if you have an accident that damages someone else’s vehicle or property while towing your unbraked trailer, we’ll cover the cost of repairing their damage,” says Jackson.

“Our Comprehensive and Third Party Fire & Theft car insurance policies also cover certain types of damage to your unbraked trailer or caravan.”

For example:⁴

• If you have a Third Party Fire & Theft car insurance policy with Youi, your unbraked trailer is covered for fire and theft.
• If you have Comprehensive car insurance with Youi, your unbraked trailer is covered for fire and theft, accidental damage, intentional damage and some severe weather events, including storms, hail and floods.⁴

“Bear in mind though that under either policy, your trailer is only covered for its market value up to $1,500, and that contents inside the trailer and business items (such as any tools of your trade) aren’t ​ ​included,” explains Jackson.

If you would prefer more cover, it might make sense to consider a separate caravan and trailer insurance policy.³

When are trailers covered by car insurance?

If you have either a Comprehensive or Third Party Fire & Theft car insurance policy, your motorcycle trailer, cage trailer, caravan or other unbraked trailer will generally be covered for damage at Youi, as long as it’s:⁴

• Being towed by the insured car
• Parked at the overnight address noted on your policy schedule
• Being used at another location by you, a listed driver or another person acting with your permission, and isn’t left unattended 24 hours or more.⁴

When might car insurance cover not apply to your trailer?

There are circumstances when car insurance doesn’t usually extend to your trailer. For example, you may not be covered if:

• Your trailer isn’t roadworthy⁴
• Your trailer is used while it’s overloaded or unsafe⁴
• Your trailer is unregistered when it’s legally required to be registered⁴
• You’re not following relevant transport laws regarding the correct use of a motor ​ ​​​vehicle.¹

Why consider caravan and trailer insurance?

If you’re trying to decide what level of insurance might suit you best, or whether taking out a separate policy for your caravan or trailer makes financial sense for you, you could start by asking yourself: “Could I afford to repair or replace my trailer without standalone caravan and trailer insurance?”^2,3

​​“As always, the decision to get separate cover depends on your unique needs and circumstances,” says Jackson. “However, if it would cost you more than $1,500 to repair or replace your trailer or caravan if it was stolen or damaged in an insured event, you might like to consider whether your car insurance provides enough cover – or whether a standalone policy would serve you better.”

Specialised caravan and trailer insurance can also offer cover for things that aren’t included in car insurance policies and that may come in handy if you need to make a claim – for example, cover for your caravan’s contents, such as furnishings or appliances, or for storing a camper trailer or flatbed trailer while you wait for repairs.¹

On top of cover for accidental damage, intentional damage, fire, theft and damage caused by some severe weather events, Youi’s Comprehensive Caravan & Trailer insurance, for example, also includes other types of cover, such as:⁵

• New caravan or trailer replacement after a total loss
• Contents inside your caravan, up to $1,000 per claim
• Towing and storage costs
• Animal death or injury for animals transported in your trailer
• Caravan park cancellation or rebooking fees after an insured event
• Cost of replacing or recoding stolen keys
• Temporary insurance cover for a new caravan or trailer.⁵

What type of caravan and trailer insurance would suit you best?

If you’re leaning towards taking out standalone caravan and trailer insurance, here are some other considerations to keep in mind that might help you choose the best policy for your needs.

How much cover do you need?

“Thinking about the level of cover you want for your trailer or caravan is a good first step,” says Jackson.

Youi offers three levels of Caravan and Trailer insurance:⁵

• Comprehensive: As the highest level of insurance, this covers your trailer or caravan for a range of events, such as accidental damage, intentional damage and damage caused by storm, hail or flood. It also includes cover for up to $20 million in legal liability if your trailer or caravan damages someone else’s property in an accident.
• Third Party Fire & Theft: Covers your trailer or caravan for fire and theft, as well as extra cover for things such as caravan park fees, trailer contents and replacement keys. It also includes cover for up to $20 million in legal liability if your trailer or caravan damages someone else’s property in an accident.
• Third Party Property Only: Includes cover for up to $20 million in legal liability if your trailer or caravan damages someone else’s property in an accident.⁵

You can learn more about these options by visiting our Caravan and Trailer insurance page.

Do I need optional types of cover for my trailer?

“At Youi, just like with your car, we may be able to offer you a range of optional types of cover for your caravan or trailer, giving you the opportunity to add more cover where you need it for an additional premium,” says Jackson.

If you have a Comprehensive or Third Party Fire & Theft Caravan and Trailer insurance policy with Youi, you can request optional cover for:⁵

• Annexes
• Electric motor burnout
• Extra cover for your caravan’s contents
• Business item cover.⁵

Are you using your trailer for business?

“If you use your trailer for work or business, it’s important to let us know,” says Jackson.

Not only does telling your insurer how you use your trailer help them calculate your ​ ​premium,⁵ but failing to disclose business use could mean you won’t be covered if you need to make a claim.¹

“It’s also worth noting that business items inside your trailer aren’t covered as part of our standard ​ ​cover for contents under either our Comprehensive or Third Party Fire & Theft Caravan and Trailer insurance,” she adds.

“So, if you do use your trailer for work, you may want to consider adding optional cover for business items if you want these to be insured.”

Car trailer insurance vs caravan and trailer insurance

Still deciding what’s right for you? Check out the handy table below for a snapshot of  how car and trailer insurance differ when it comes to covering your trailer at Youi.

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Now that you understand more about how trailers are – and aren’t – covered by car insurance and what standalone caravan or trailer insurance could offer above and beyond car insurance cover, you can hopefully make a more informed decision when choosing the best option for you and your tow.

At Youi, we offer multiple Caravan and Trailer insurance options. To see if one might be a good fit for you, consider starting a quote online or by giving us a call on 13 9684.

¹ Source: Canstar – Trailer Insurance, February 2026
² Source: Moneysmart – Choosing car insurance
³ Source: Canstar – Caravan Insurance: For Your Home Away From Home, May 2025
⁴ Exclusions, limits and additional fees may apply. For full details, see the Car Insurance PDS.
⁵ Exclusions, limits and additional fees may apply. For full details, see the Caravan & Trailer PDS.