In general, most personal automobile insurance policies exclude business use of a personal auto. You should review your coverages with your insurance representative before renting out your personal vehicle, or giving rides to customers through a Transportation Network Company, or making deliveries for hire. To prevent uncovered losses and liabilities, you will want to ensure that you have other coverage in place.
Using Your Car to Earn Money in a Transportation Network Company (TNC)
A TNC is an online-enabled application or digital network used to connect passengers with drivers using vehicles for the purpose of providing prearranged transportation services for compensation (i.e. Uber, Lyft, etc.). If you are giving rides to paying customers through a TNC, either you or the company will need to obtain insurance that meets certain minimum liability requirements and you must carry proof of insurance that meets those requirements. Importantly, the law does not require these policies to include comprehensive or collision coverage, so they may not cover damage to your vehicle. This coverage gap could be especially problematic for drivers with a car loan because most lenders require borrowers to maintain insurance that will cover loss of the vehicle at all times.
Using Your Car in a "Sharing" Program
If you are renting your vehicle through a peer-to-peer car sharing program, a standard auto policy will not cover the vehicle during the rental period, and it will be up to you, your provider and/or the driver to fill the coverage gap. Drivers will need insurance to cover their liability to others, and you may need insurance to cover theft or damage to the vehicle. You should familiarize yourself with the terms of that insurance and keep proof of the insurance policy in the rented vehicle at all times.
Using Your Car For Business Deliveries
If you are using your personal vehicle to make pizza, grocery or other deliveries, it is wise to review your insurance arrangement. Even if you have a personal auto policy, it likely contains a business use exclusion, which means that it is unlikely to cover you for accidents that occur while you are making deliveries. If this is the case, you may be able to add the necessary coverage by supplementing your existing policy or by switching to a product that includes the coverage that you need.
Whether you are offering your personal vehicle for rides or rent, it is always a good idea to consult with a licensed insurance agent to find the insurance coverage that is right for you. Gaps in coverage can have serious financial consequences.
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