In the age of the side-gig, many of us are looking for new and unique ways to supplement our income. One increasingly popular way to make money is by using your car. Before you put your personal car to work for you, you need to know if your current insurance policy will cover what you are doing with your car.
Some examples of how your car might “work” for you:
1. The Work: You decide to drive for Uber or Lyft. These Transportation Network Companies (TNCs) use a cell phone application to electronically “hail a ride” for a fee. While on-duty for the TNC, you have your cell phone application on awaiting a customer. You are paid by the TNC for providing the ride.
Insurance Issues: If you have a standard Massachusetts personal auto policy, there is NO coverage for anyone injured while occupying your car while it’s being used as a public or livery conveyance. In addition, the policy will not pay for Property Damage, and coverage under all optional insurance parts — like Optional Bodily Injury, Medical Payments, Collision, Comprehensive and Underinsured Auto Bodily Injury — is excluded. While some coverage is provided by the companies, there are serious possibilities for coverage gaps. If you are considering driving for a TNC, make sure to call your insurance agent to discuss your coverage options.
2. The Work: You travel frequently for business, so you enroll in a service like Turo that will “loan” (rent) your car to others who travel to Boston for business or pleasure. In return, you will receive a small rental fee for each use.
Insurance Issues: Your policy would not cover a loss if your vehicle is being rented out since a vehicle rented to others does not qualify for a personal auto policy. Reach out to your insurance agent, who may be able to find coverage with a personal or commercial auto insurer.
3. The Service: There are also companies that rent cars to consumers by the hour or by the day. In the case of Zipcar, members are free to drive cars by the hour or day, and cars are available (parked for access by Zipcard holders) in neighborhoods, cities, and airports around the world.
Insurance Issues: If a Zipcar member has a personal auto policy, the policy would follow the member when renting a personal automobile with the permission of the owner as long as the member is not regularly using the same car. If the Zipcar member will use the same car often, the “Use of Other Auto” endorsement could be added to your policy to cover the exposure. We should caution you that coverage under the personal auto policy is not worldwide and would be limited to accidents occurring in the United States, its territories and possessions, Puerto Rico, and Canada.
If you are thinking about putting your car to work for you, or if you have already signed up with one of these services, please give us a call at (800) 333-7234 to discuss your insurance needs. Our number one priority is making sure you have the coverage you need in the event of an accident.