Whether you are just starting out, or have been renting trailers for a while now, creating and using a comprehensive trailer rental agreement is necessary to not only protect your business, but it also helps your customers as well. A good rental agreement will focus on establishing clear expectations, responsibilities, and provide guidance on legal protection for both the renter and the business. No matter what kind of trailer you rent, whether it be enclosed, cargo, utility, or flatbed, having a well crafted, universal rental agreement is vital.It is strongly recommended that you do not copy or use a generic agreement.A rental agreement should be created for your specific company and it is always advisable to have an attorney look it over before implementation.Here are a few aspects to consider when drafting your rental agreement.
1. Define the Rental Terms and Conditions
Start by defining both parties, this can be as simple as writing the company name as well as the customer name. We suggest you also collect their phone number, email, and physical address. Next you will want the rental information, this includes trailer information, start and end dates, and fees that will be charged. You can also include what terms the rate will be charged at whether it be hourly, daily, weekly, or monthly. If there are any additional fees such as late fees, or card fees, clarify them here. For more information on pricing structure or help drafting your agreement, contact us and we will be happy to walk you through the process.
2. Detail Insurance Requirements
Next, you will want to specify any insurance requirements for the rental. This includes if the renter has to provide their own insurance coverage or if you will be providing coverage. Here, you should clearly define the minimum coverage requirements for both liability and collision. Some insurances will provide what is called a “binder.” This will help if there is an accident or damage to the trailer as it specifies the trailer for the rental duration being covered under that policy. It will also be a good idea to address the renter’s responsibility regarding deductibles and how to handle claims if damage occurs. If you are going to offer insurance or cover the rental yourself, clearly define what you will cover and up to how much.
3. Outline Liability Clauses
Adding to the insurance section is liability clauses. If damage were to occur, who is responsible for expenses? Details should be provided about how damages are assessed and how repair costs will be determined and handled. Highlight key precautionary steps such as check in photos you take, monitoring rental location, and maintenance performed on a regular basis that help protect your trailer and it’s condition. This section should clarify liability concerns and prevent disputes that may come up.
4. Clarify Maintenance Responsibilities
Proper trailer maintenance keeps the trailer in safe and operable condition. Most of the trailer’s maintenance will come from the company, however you should point out anything the customer is responsible for. This might include cleaning the trailer if it gets dirty, replacing any parts that wear out or are broken along the way - these can include tires, shackles, breakaway cables. This section should specify that the trailer must be returned in the same condition it was rented out in and any fees that may be associated by not.
5. Define Cancellation and Refund Policies
Things happen! Renters will sometimes have to cancel or change their rental. Transparent cancellation and refund policies help manage customers expectations. Outline any cancellation fees, the timeline at which fees will be collected and how refunds will be handled. This section should also describe the procedure for requesting cancellations or changes. Can the customer contact you via email or phone for them? Consider including partial refund options for specific cases to keep your policies flexible and customer-friendly.
6. Set Usage Restrictions
In order to prevent misuse and damage that can occur from it, establish usage restrictions. These should include miles included with the rental, prohibit off-road use, limits on type of cargo allowed, and restrictions on who can tow the trailer. This section should contrarily should also define proper usage and inform the customer of proper towing procedures. Adding this section will help in reducing improper use and setting expectations. Instructions and restrictions should be firm and it is better to over clarify than under in this section.
7. Describe Dispute Resolution Procedures
Including a dispute resolution clause can help the process if any disagreements occur pre, during, or post rental. Specify what types of disputes will be handled through mediation, arbitration, or legal action. Typically smaller disagreements can be resolved through direct communication and do not require a third party. That being said, larger claims can quickly turn into legal disputes so it is important to make customers aware of what they can expect. A structured dispute resolution procedure fosters a professional approach to resolving issues and helps both parties avoid lengthy, expensive legal battles.
8. Collect Qualifying Information
It is recommended to collect what type of vehicle they will be towing with as well as their driver’s license information. Collecting the vehicle information including license plate number and make and model can help you and the customer determine if it will be able to tow your trailer. It will also help identify who has your trailer in the case of theft or loss. Collecting the customer’s license information can prove identity and you can verify age and eligibility to rent a trailer. It will also help prevent fraud. This may seem like a small step but it is truly one of the most important.
9. Include a Signature Section
Finally, include a section for both the rental business and the renter to sign and date the agreement. A signed agreement is legally binding and confirms that both parties understand and accept the terms of the rental. Signatures ensure mutual understanding and accountability for both the rental provider and the customer. We also recommend having an initials section either next to every section of your contract or at least at the end of each page. This will help prevent any disputes that may come up of not understanding what they were signing.
Conclusion
A well-structured trailer rental agreement protects your business and fosters trust with customers by setting clear expectations. With this agreement in place, you’re prepared to handle any rental situation confidently and efficiently. For more advice on running a successful trailer rental business, explore additional resources on Unlocking The Full Potential When Renting Your Trailer or list your trailer on our Rental Marketplace.