Does car insurance cover peer-to-peer rentals?

Q: How does insurance work with peer-to-peer car rentals?

For car owners/hosts: You'll keep your own car insurance policy, but it likely won't cover your car while it's rented out. You'll also choose from the peer-to-peer rental service's insurance offerings for coverage while your car is being rented. Let your personal car insurance company know that you plan to rent out your car.

No, your personal car insurance policy typically won't cover your car while it's being rented out via a car-sharing service. In some states, your insurer may even deny you coverage if you rent out your car. If you're thinking about renting out your car on a peer-to-peer rental network like Turo, you'll likely need to get the insurance offered by the rental service. Don't cancel your personal auto policy, though — peer-to-peer rental services typically require you to have your own car insurance, as well.

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What is peer-to-peer car insurance?

You can get insurance through the peer-to-peer rental service for coverage while your car is rented out. The peer-to-peer insurance coverage available will differ by company but may include these options:

Liability coverage: In case a third party makes a claim against you related to your vehicle while it's rented out
Repair reimbursement: In case a renter returns your car with eligible damages
Cleaning reimbursement: In case your car is returned with eligible cleaning needs
Roadside assistance: In case your car breaks down during a rental

Some peer-to-peer rental services may offer more traditional car insurance coverages like comprehensive, collision, uninsured motorist, and personal injury protection or medical payments for when your car is rented out. You'll still need to carry your own personal car insurance as well, regardless of the peer-to-peer insurance coverages you opt into.

How does insurance work with peer-to-peer car rentals?

For car owners/hosts: You'll keep your own car insurance policy, but it likely won't cover your car while it's rented out. You'll also choose from the peer-to-peer rental service's insurance offerings for coverage while your car is being rented. Let your personal car insurance company know that you plan to rent out your car. If your insurer chooses to drop you (they can do that if you rent out your car in some states), you can compare car insurance rates to find a new insurer.

For car renters: Your personal auto insurance will typically extend to cars you rent. This means the coverages, limits, and deductibles associated with your policy will apply. So if you have liability, collision, and comprehensive coverage, for example, those coverages will be in effect when you're behind the wheel of a car you've rented from a peer-sharing network. Learn more about how car insurance works.

Additionally, if you don't have car insurance or would like additional temporary coverage, peer-to-peer companies let you opt into auto insurance for the time that you're renting, similar to rental car insurance. These rates generally vary depending on the level of coverage you want and the car you choose to rent.

Can I rent out my car with no insurance?

No. You'll need at least a personal auto insurance policy to rent out your car on a peer-to-peer site. Owners are typically required to meet the state minimum coverage requirements to list the car. And to host, you'll select a protection plan that includes a minimum of third-party liability insurance. Some companies may automatically opt you into a single protection plan.

These requirements act as proxy car sharing insurance and can be waived if you buy commercial insurance instead (which may only be practical if you're renting out multiple cars).