One limitation today in simulating horizontal segregated flows is that there is no treatment of droplet formation mechanisms at wavy surfaces. For self-generating waves and slugs, the interfacial momentum exchange and the turbulence parameters have to be modelled correctly. Furthermore, understanding the mechanism of droplet entrainment for heat and mass transfer processes is of great importance in the chemical and nuclear industry. A further step of improvement of modelling interfaces is the consideration of droplet entrainment mechanisms. The proposed entrainment model assumes that due to liquid turbulence the interface gets rough and wavy leading to the formation of droplets. The new approach is validated against existing horizontal two-phase flow data from the HAWAC channel.