Ridesharing or carpooling, in their various formats, can save you money or make you money. However, you need to clear it first with your car insurance companies; most of these companies are wary of ridesharing. Here are some of the concerns your insurance company may have with ridesharing:
It's Tempting to Do It for Money
Private car insurance coverage is meant to protect you from the risks you might face while using the car for your personal reasons. If you drive a car for personal gain you ought to buy commercial car insurance. Unfortunately, it is easy for carpooling (private) motorists to start earning money from their cars, which would violate their insurance companies' terms and conditions. This is especially true if you are sharing your car with strange drivers who pay you for their use of your car.
It's Easy for a Stranger to Drive You Car
Your car insurance coverage includes every member of your household (unless they have been specifically named as excluded drivers) and everyone else you may permit to drive your car (permissive user) from time to time. The assumption is that you will only loan your car to those you know responsible to be responsible to drive your car. When you let your car to be driven by strangers, however, you are exposing yourself to risks you know nothing about. Your insurance company doesn't want to face such risks either, which is why they frown upon ridesharing.
It Increases Your Exposure to Liability
Lastly, ridesharing exposes you to more risks and greater liability than restricting your car's use to your household members and permitted drivers. Think of it this way: the more you share your car with others, the more your car will be on the road being driven by (possibly) strangers. This increases the risk of exposure to accidents or driving violations such as driving under the influence (DUI).
Apart from that, ridesharing usually results in carpooling, where a bunch of people going in the same car pool their resources and share a car. This means your car will be carrying multiple passengers at any particular time, which increases the potential liability you may be required to settle in case of an accident.
As you can see, there is a lot your insurance company has to worry about when it comes to ridesharing or carpooling. Therefore, don't get into any of these things without clearing it first with your car insurance company. Otherwise, you risk jeopardizing your relationship with the insurer or having your claim denied in case it arises out of a practice banned by your insurer. For more information, contact companies like Marcus Steven M Inc.
Share14 September 2017
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