Things to Consider Before Using a Car-Sharing Service
There are benefits and drawbacks to car sharing—just like when you drive your own car—but is sharing right for you? 4 things you should consider before getting started.
Car sharing can be a great way to save money and increase flexibility. According to AAA, in 2017 the annual cost of owning and operating a new car averaged nearly $8,500—and that doesn’t include payments for the the car itself. Because car-sharing services allow you to pay only for the time you’re using a car (in addition to certain fees), the cost can be significantly lower. If you don’t need a car often, or if you occasionally need a second car, sharing might be a good choice.
- It can help the environment and reduce traffic. This one is pretty self-explanatory, less cars on the street equals less greenhouse emissions and less traffic.
- If you’re thinking about peer-to-peer sharing, check your state’s laws. Peer-to-peer renting has many benefits, and often includes a selection of interesting cars. But if you’re the one providing the car, participating in the network can create issues, depending on where you live. Some states have enacted regulations around peer-to-peer sharing, including a limit on how much revenue you can generate annually with your vehicle. The sharing program itself also needs to meet certain requirements.
- No matter what you choose, check your insurance coverage. Sharing your own vehicle in a peer-to-peer network in some states could put you at risk—even though these programs include insurance, it might not be enough to cover medical expenses and other costs in the event of a crash. Also, your insurance company might not renew your auto policy, or your premiums could increase significantly. Car-sharing programs that feature company-owned vehicles include insurance, too, but it might be wise to consider additional coverage. For example, your credit card might provide extra protection, and insurance companies have non-owner policies available as well.
There’s a lot to like about car sharing and a lot to think about. Don’t hit the road before weighing the pros and cons—and make sure you’re protected.