Care to Share? How Joining a Car or Bike Share Program Could Impact Your Insurance

Across the country car and bike share programs are gaining in popularity as a way to ease congested traffic patterns in urban areas while at the same time providing more flexible transportation alternatives to public transit. These programs are a great alternative for urban dwellers and college students who may not own a car or bike but occasionally need one to run errands, or to use as an alternate means of commuting. Members who join one of these programs pay a membership fee for a period ranging from a few days to annual memberships. Members then are given access to the cars or bikes in the program for short term use of the vehicle (a few hours), so it can be cheaper and more convenient than renting a car from a traditional rental car company. Companies such as Zipcar are already set up in 34 states, primarily in cities but increasingly on college campuses, including suburban campuses. Bike share programs are growing in popularity in these same places, and as we move into the spring months their popularity can only grow. But how does your insurance work with these types of bike and car share programs?

Insurance and Car Share Programs

Zipcar, and programs like it in specific cities (See an independent program in Philadelphia at www.phillycarshare.com), typically offer their members some insurance coverage and roadside assistance. But is their insurance enough to cover you on the road? In most cases the membership fees for the car share programs will insure drivers for up to $300,000 in liability and physical damage, though members need to be aware that there’s usually around a $500 damage fee on any physical damage to the vehicle (so try not to hit anything with the car!). The question consumers need to ask themselves is whether the insurance you receive as a member is the appropriate amount of coverage for you. If you were to be the cause of a 20 car pile-up or if you were in an accident where someone was severely injured, how far would $300,000 go to cover your liability?

A Trusted Choice ® Independent Insurance Agent can help you determine how much insurance might be the most appropriate for your situation, and can help you obtain additional coverage if it’s needed. You may be pleasantly surprised that additional liability coverage may not cost too much more in premium. Let’s look at different scenarios regarding potential car share program members and how they would or wouldn’t be covered.

Situation One: You already own a car and have auto insurance but joined a car share program

Maybe you already own a car but occasionally need access to a larger vehicle like a van or SUV for errands like picking up materials for a home improvement project, moving furniture or even to transport the little league team across town. Car shares can be a great solution if you live near a local car share “station” and need a car for a few hours on the weekends. Another situation where you may already have auto insurance for cars you own would be if you joined a car share program for your son or daughter who is a college student living away from home. In either case, since you already have a policy it would likely provide you and your family members with additional insurance coverage if the $300,000 wasn't adequate. It would provide protection for medical payments and coverage for you in the event you were in an accident with another driver who was uninsured. Family members are also covered by this provision, including college students, provided they are still dependents who live at home when they are not in school. Make sure that you discuss what your current policy would cover with a Trusted Choice insurance agent when you join a car share program under either of these circumstances.

Situation Two: You do not currently own a car and have no auto insurance

If you are a true urban dweller or a student who may not covered by someone else (i.e. a graduate student no longer covered by your parents policy), you still have options to make sure you have appropriate insurance coverage when joining a car share program. In this case you should talk to a Trusted Choice insurance agent about a Named Non-Owner Policy, which provides you with insurance coverage for liability, medical payments and uninsured motorist coverage, in addition to the coverage you have as a member of the car-share program. It’s important to recognize though that this type of policy would not provide additional coverage for physical damage to the car beyond what you have as a member of the car share program, though additional coverage for physical damage may not be necessary. It’s best to review your options with a Trusted Choice agent.

Insurance and Bike Share Programs

Unlike car share programs, most bike share programs do not provide you with any insurance as part of the membership, so it’s important to understand how other insurance policies you may have would apply. In most cases, if you were in an accident involving a bike from a bike share program, your homeowners insurance or renters insurance would cover your liability if you were to injure someone with the bike. Damage to the bike would typically be covered if it was a result of another vehicle or vandalism, but it may be subject to a deductible, which could exceed the cost of the damage. If the bike is stolen while it’s in your possession you should be covered for theft, but it’s important to report the theft both to the police and to the bike share program as soon as you are able. Finally, make sure when you use a bike, you return it in a timely fashion, as some of the bike share programs will consider a bike “stolen” if it is kept for more than 24 hours- and they could subject you to a replacement fee for the bike, which would not be covered by your policy.

It’s important to make sure you’re aware of what your homeowners or renters policy will and won’t cover as it relates to participating in a bike share program by reviewing your homeowners or renters insurance policy with a Trusted Choice agent.

Care About What You Share

The best way to enjoy car and bike share programs is by obeying the terms, conditions and rules of the program, and the best way to feel confident on the road is by making sure you have the right insurance coverage. Whether you’re a weekend warrior, have a son or daughter away at college or are an urban professional, make sure you’re covered appropriately by speaking with a Trusted Choice independent agent.