Sharing is Good …Not Always!


Thinking of jumping on the “car sharing” or “ride sharing” bandwagon? You may want to think again!

“Car sharing”, or the loaning of your vehicle when you are not using the vehicle, is gaining popularity in larger cities. It is being marketed as an alternative to using the traditional car rental agencies. Owners sign up with a company who takes care of renting the vehicle for a specified period of time, and in turn receives money for the time period the company rented out the vehicle. Sounds simple and easy way to make some extra cash right? WRONG! First off, think about the way people operate rental cars. Do you want to risk someone driving your vehicle recklessly? Probably not! Also, is it sharing or renting? Sharing doesn’t always meaning receding money, but renting does! More importantly is how your insurance will respond in the event the reckless driving turns into a claim. The company renting out your vehicle is supposed to cover the vehicle…right? Yes, but who do you think will also be named in any suit resulting from an accident? The owner of the vehicle, YOU! Ever heard the phrase “You loan your car, you loan your insurance?” That most definitely would apply, and your insurance company isn’t going to like the idea!

“Ride sharing”, the new cool way to carpool while making money, has taken off in large cities and now is moving to suburban areas. The service connects people who need a ride, with a registered driver and payment is made via credit card. So if it’s just carpooling, what’s the big deal? Well, the old way of carpooling was fine. People took turns driving to save money on gas and help reduce pollution. However, the new “ride sharing” is creating some issues for the insurance companies. “Ride sharing” is essentially turning your personal vehicle into a taxi service, because you are accepting payment for transporting people. If your vehicle is insured on a personal auto policy, you could potentially VOID your coverage if you are operating a “taxi” service. Many towns actually require drivers who participate in “ride sharing” to have a chauffer’s license (taxi driver)! The ride share companies claim to have coverage in excess of the individual drivers’, but your coverage will be primary!

In today’s economy, it’s easy to understand the lure of “easy” money. Before you consider either of these options, CALL YOUR AGENT!!! What seems like a simple way to make some extra money could end up costing you A LOT in the long run.

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