The process of car sharing is a controversial business idea, even though it’s grown into a business opportunity that merely rents out the car you already have. For those who just need some extra money each month to help supplement their income, it can be a viable way to make money if they don’t use their car often. For those who do, it can potentially have some negative sides you’ll need to strongly consider.
Despite some of the negatives involved, various car sharing businesses exist in the United States. Two of the better known names are Relay Rides and Getaround. Which one should you choose, and what risks do you take with the insurance side of things?
This company is probably the best known in the world of car sharing, and one look at their site will tell you that some of the rental deals are quite good. Some rentals go as low as $32 a day for very small cars only a few years old. Likewise, you can take your own idle car and rent it out through the company. They let you list your car for free, plus insure you up to $1 million dollars in the chance the user gets in an accident.
It’s also easy to access their site as an app for your smartphone. You can keep tabs on your car this way, plus quickly look up a car to rent in your local area.
The company acquired a third car sharing company called Wheelz last year, which may diminish any chances of more competition in this growing industry.
This site can give you even better deals on cars that might be older, yet still very workable. Getaround is extra careful on driver records and does cross-checks through the credit bureaus and 16 other points of reference. Working as a peer-to-peer system, you can find a car right in your local area with deals that go as low as under $10 a day.
Unlike some of the other car sharing companies, they help keep the renter and owner in direct contact with one another so there’s no disparity in how the renter uses your car.
The Problems with Insurance
Edmunds.com wrote on some of the insurance issues that still affect people doing car sharing. In some states, insurance companies refuse to cover those who partake in car sharing. The reason is that the insurance considers car sharing to be a business and conflicts with personal coverage. All three states along the U.S. west coast have enacted laws that force insurance to keep people insured when doing car sharing. Many states, though, still face this issue.
Then there’s the problem of liability coverage. In a rare case where a renter of your car kills someone in an accident, it can fall on your shoulders because you own the car. Despite both companies insuring a considerable amount, it could go over that in a lawsuit or in medical bills.
It’s why you have to make very careful choices when working with car sharing companies. Be sure to check if that company uses tracking technology in your car so you can also prevent the renter from taking off with your car and never bringing it back.
With jobs harder to find for some people, you can see why car sharing continues to hang in there as a moneymaking opportunity. Eventually, it could also replace car leasing as a chance to have a car without paying high lease rates based on interest rate fluctuations.