Reefer breakdown is a trucking industry term that describes an event when the refrigerated unit on a “reefer trailer” (refrigerated trailer) breaks down.
What causes that breakdown can be a number of different things including lack of fuel, electrical issues, low oil, a mechanical issue with the unit, etc.
Reefer breakdown represents one of the leading causes of high-value cargo loss in trucking. A failed refrigeration unit exposes perishable freight to spoilage within hours. To manage this risk, carriers can often rely on reefer breakdown coverage — also known as reefer breakdown insurance — within their motor truck cargo policies.
In this article, we’ll explain what reefer breakdown really means, how it differs from a simple “temperature change,” how insurers treat claims, and practical tips to reduce the risk of a breakdown on the road.
What Is a Reefer Breakdown?
A reefer breakdown occurs when the refrigeration unit that cools your trailer experiences a mechanical or electrical failure. Common causes include:
- Compressor or condenser failure
- Burned-out fan motors
- Refrigerant leaks or low levels
- Electrical shorts or blown fuses
- Malfunctioning control modules
- Fuel supply interruptions
When this happens, your reefer trailer can no longer maintain the proper temperature. For perishable cargo like produce, meat, or pharmaceuticals, that’s a direct path to spoilage and costly claims.
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Reefer Breakdown vs. Temperature Change: Why It Matters
Insurance policies often distinguish between reefer breakdown and temperature change, and it’s important to understand the difference.
| Cause of Loss | Definition | Coverage Treatment |
|---|---|---|
| Reefer Breakdown | Mechanical or electrical failure of the refrigeration unit | Typically covered under “reefer breakdown coverage” provisions. Carrier must show the reefer itself malfunctioned. |
| Temperature Change | Cargo spoiled due to outside factors — e.g., door left open, faulty insulation, ambient weather conditions | May or may not be covered. Many insurers exclude these losses unless specifically endorsed. |
A significant cargo insurance claim that I saw when I worked for a large insurance carrier involved cargo that was damaged due to a temperature change. It turns out that a forklift driver at the shipper damaged the air chute that helps carry air to the rear of the trailer when he was loading the boxes of produce.
How would your motor truck cargo insurance respond to this loss? Would you have coverage if the air chute in the trailer is damaged by a forklift driver and it causes the temp in the rear of the reefer trailer to rise above the desired temp?
To some cargo insurance companies, that may be a covered cause of loss. To others, that wouldn’t be a covered cause of loss because the “breakdown” didn’t actually occur in the electrical unit of the trailer refrigeration system.
Key takeaway: Reefer breakdown coverage protects against the reefer unit failing. Temperature change coverage protects against environmental or human factors. Not all insurers treat these the same, and some limit or exclude temperature change coverage altogether.
How Reefer Breakdown Insurance Works
Reefer breakdown insurance is usually offered as an endorsement to a motor truck cargo policy. It extends coverage specifically to losses caused by refrigeration unit failures. Without it, you’d be responsible for the full value of spoiled freight.
However, insurers are strict about documentation. They may require:
- Maintenance logs showing regular inspections and service
- Temperature monitoring records from ELDs or telematics
- Diagnostic reports from repair shops proving mechanical failure
- Proof of prompt reporting and efforts to mitigate damage
If the insurer determines the loss was caused by neglect, poor maintenance, or operator error, the claim may be denied.
Be sure to check what is covered under your motor truck cargo insurance policy to avoid any surprises with this key coverage!
Tips to Prevent a Reefer Breakdown
While you can’t avoid every failure, preventive practices can save both your cargo and your insurance record:
- Stick to scheduled maintenance: Regular servicing of compressors, belts, fuel lines, wiring, and controls.
- Pre-trip checks: Test reefer start-up, set temperatures, check fuel levels and alarms before leaving the yard.
- Use temperature monitoring: Telematics provide real-time alerts if cargo temperature drifts.
- Carry spares: Belts, fuses, and small parts that can keep you moving in a pinch.
- Driver training: Ensure drivers know alarm codes, how to check airflow, and when to call for service.
- Rotate equipment: Don’t overwork one reefer; share mileage across your fleet.
Preventive care doesn’t just reduce breakdowns — it also strengthens your defense if you need to file a claim.
Why Reefer Breakdown Coverage Is Critical
A spoiled load of strawberries or vaccines can easily exceed $100,000 in value. Without reefer breakdown insurance, that loss falls squarely on you. With it, your motor truck cargo insurance can help cover the cost — provided you’ve met your cargo insurance policy requirements and exclusions.
Having the right motor truck cargo coverage in place not only protects your balance sheet but also reassures shippers and brokers that you take their freight seriously. You also want to be sure that you have a very good understanding of the Carmack Amendment.
The key is for fleet owners to understand what exactly is covered when your cargo insurance company talks about “reefer breakdown” as that can mean a number of different loss events. This can also be different than what’s required by shippers or in documents like the UIIA Insurance Requirements.
Cargo insurance policies can be hard to understand, so be sure to ask your insurance agent this question:
What is considered to be a reefer breakdown?
For bonus points (and some blank stares) you could also ask: What is considered a covered cause of reefer breakdown loss for my cargo insurance policy?
You may be surprised by the answer!
There are some good and some not so good cargo insurance policies out there and it can be hard to tell them apart. Just know that each cargo insurance policy can be different (in major ways).
Seek the help of a well qualified insurance agent who can help you uncover these issues!
Reefer Breakdown FAQs
Is reefer breakdown covered by standard motor truck cargo insurance?
Not always. Many cargo policies require a reefer breakdown (equipment breakdown) endorsement. Without it, mechanical/electrical failures of the unit are typically excluded. Also remember that these are typically full load losses.
What’s the difference between reefer breakdown and temperature change?
Reefer breakdown = mechanical/electrical failure of the refrigeration unit.
Temperature change = loss from external or human factors (door left open, ambient heat, bad insulation, reefer unit ran out of fuel). Insurers often treat these separately and may limit or exclude temperature change unless specifically endorsed.
Does “running out of fuel” count as a reefer breakdown?
Usually no. Many policies exclude losses caused by lack of fuel, operator error, or neglect. Check your policy’s exclusions as every motor truck cargo insurance policy is different!!
What documentation helps a reefer breakdown claim get paid?
Maintenance and service logs, telematics/temperature records, alarm history, diagnostics from a qualified tech, repair invoices, and prompt notice to the insurer. Good records = stronger claims.
Are wear and tear or lack of maintenance covered?
Typically excluded. Insurers expect reasonable preventive maintenance. Gradual deterioration or known defects often void coverage.
What limits or sub-limits apply to reefer breakdown coverage?
Some policies apply sub-limits or separate deductibles for reefer breakdown or temperature change. Confirm limits, deductibles, and any per-commodity caps with your truck insurance agent.
Does reefer breakdown coverage include cargo salvage or disposal costs?
Often yes, but subject to policy terms. Many policies cover reasonable mitigation (salvage, reconditioning, disposal) within the overall limit. Generally, temp controlled freight is destined for human consumption and the shippers will forbid you from taking possession of any related salvage.
How can I reduce the risk (and cargo insurance premiums)?
Stick to scheduled maintenance, use telematics for temperature alerts, train drivers on alarms and airflow, carry critical spares, and rotate equipment. Strong prevention may also improve underwriting outcomes.
Final Thoughts
Reefer breakdowns are unpredictable, but the financial fallout doesn’t have to be. By understanding the difference between reefer breakdown coverage and temperature change provisions, keeping your reefer units in top shape, and ensuring your reefer breakdown insurance is properly endorsed, you’ll be ready to keep freight moving — and protect your bottom line when things go wrong.
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