We try to stay up to speed on all the new startups, especially those that may touch the car insurance world. A handful of car rental/swap services have popped up across the country, which is good for consumers, but can raise questions insurance-wise.
We've looked into Zipcar and RelayRides already, which are two relatively established companies offering a different strand of car rental.
Recently two others have popped up and they're quickly becoming popular. Lyft, which is used exclusively on mobile -- iPhone and Android apps -- is a ridesharing service owned by parent company Zimride. It is donation-based, which the app recommends (asks for) at the end of the trip, which includes a $2 tip already baked in. Lyft's mantra is "your friend with a car" and is focused on a footloose, entertaining customer experience.
Getaround is a social car sharing service run predominantly from the browser, however they do have an iPhone app. Car owners rent their vehicles out to the users, which they nicely refer to as "a community of trusted drivers." For owners, It basically monetizes your car while you're not driving it. Riders can micro-rent vehicles for short periods of time, on short notice -- very inexpensively.
So how do these two new companies insure the drivers and keep their customers safe?
In the case of Lyft, Zimride provides drivers with excess liability insurance up to $1M through a A++ rated insurer. This is completely free for their drivers and is excess liability protection, which means it goes beyond a driver's existing insurance policy. Driver's are required to maintain their personal auto insurance, per Zimride's terms of service.
For Getaround, insurance works similarly to a personal policy when a car is rented. Both the owner and the renter are covered under Getaround's A++ rated insurance policy. The policy provides coverage for liability, collision, and theft that may occur during the rental period. There is a $500 deductible that the renter is responsible for. Car owners are required to keep their personal insurance per state law for the times the car is not rented. This is because coverage is only active during the rental period.