The latest wrinkle in having a vehicle to drive when you need it is to sign up with a car-sharing company and pay to drive someone else’s car. If you live in an urban area of the country, chances are such a company may be in operation near you. What do Florida car insurance companies think about this?
Generally, they are not pleased.
Florida Car Insurance Companies
The rental model works this way: A car owner contracts with a car-share company to let someone else borrow the car for a fee. The company takes a cut of the fee for making the arrangement possible. A key is exchanged and the person renting the car takes off for an evening, a day, a week, or whatever period the contract stipulates and then returns the car to the owner.
The problem with this in the eyes of Florida car insurance companies—and insurers everywhere else—is that the insurance policy covering the car is pegged to the policyholder, not to some stranger. The policy is predicated on the driving habits and police record of the car owner, whereas the person with whom the owner is sharing the car might have much poorer driving habits or a record of speeding convictions or DWIs.
This system of insurance seems like an entirely practical way to issue policies and retain some control of the situation. After all, people are the problem. Car insurance premiums would be really low if the expectation is that they would never be started and run on the road. In other words, it is the drivers of the vehicles—not the vehicles themselves—that pose the risk.
“If the ‘renter’ were involved in an accident, most likely the insurer would non-renew or maybe even rescind the auto policy,” Loretta Worters, a spokeswoman for the Insurance Information Institute, told a New York Times interviewer in March. It follows that if the car-sharing concept catches fire and races across the country, insurers will have their antennae up for accident trends that threaten the viability of the companies.
Perhaps Florida car insurance companies will develop an insurance product that covers this new wrinkle in auto use. Till that happens, car owners should understand the possibly adverse implications of renting out their cars.
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