There has been much talk in the papers and radio about Peer to Peer car sharing services. This is a new concept in the realm of car rental services. There are now several segments to the rent a car industry which did not exist a few years ago.
Most people associate the term car rental with the major car rental companies you may see at the airport such as Hertz or Budget or the local car rental companies you may find in your neighborhood such asEnterpriseor Allcar Rent A Car.
In the past several years, several companies have started renting cars by the hour. Most notable among these companies is Zipcar though several other local and national companies have been entering this new market.
The latest craze in this segment is known as Peer to Peer car sharing. Under this concept, there is a company centralizes a process matching people wanting to rent a car with those people wanting to rent their own personal vehicle.
In theory, the idea is a great way for a vehicle owner to earn a few dollars renting out their car when it is not in use to someone needing a car. The vehicle owner typically keeps about 60% of the rental fee while the other 40% covers the costs of the program.
While the central company promises to maintain an insurance policy which covers each vehicle owner, what happens if that policy is not in effect?; what if the person driving the vehicle violates provisions of the master insurance policy and coverage is denied?
Your own personal insurance policy will not cover the loss as all personal insurance policies prohibit the use of a personal car as a rental or livery vehicle. If your company learns that you rent your car, they may even preemptively cancel your policy. While that has not happened to my knowledge, should the insurance companies experience losses, they are certain to at least ask about your intentions when they quote the policy.
What happens if the person driving your car commits a crime or incurs a traffic summons? Are you prepared to risk having your vehicle impounded or deal with the administrative headaches to resolve parking violations?
Do you really want total strangers coming to your house to borrow your car for a few dollars?
While this is a novel idea, there are many risks to consider before you rush to sign up for the privilege to have strangers taking your car out for a ride.