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Car Sharing? Protect Yourself First!January 9th, 2009 Noyes Hall & Allen
A Valuable Service
Car sharing is an economical way for people who don't own a vehicle – or who need an extra one periodically – to access a private vehicle. Led by Zipcar, the service have been extremely popular in urban areas and at colleges – including Bates College in Lewiston. Now, it's finally come to Portland, Maine – thanks to UCarShare, a division of Uhaul.
Car sharing is often seen as environmentally friendly, because it can reduce the overall number of vehicles on the road, cut down on the demand for parking, and allow people who prefer to use alternative transportation (public transportation, bicycle, scooter, walking), but still need to use a private vehicle from time to time. It encourages density, and helps to reduce sprawl by making city living more convenient. We support the idea, and have blogged about it before.
One Big Issue
There's just one aspect that we think you should think about before joining a car share service: liability. Car share companies provide insurance for members while driving the car. But how much? Zipcar says they provide $300,000 of liability coverage (less for members under 21 years old).
The problem is, you can get into a lot more trouble than that. Maine's Wrongful Death Statute allows up to $500,000 in damages per person, PLUS punitive damages. If you're driving a Zipcar and cause an accident that kills someone, you could be looking at at least $200,000 of responsibility, out of your own pocket. Even worse, you'd have to pay your own legal defense expenses once Zipcar's $300,000 limit was exhausted.
UCarShare appears to offer even less liability coverage. Their web site says that they offer state minimum limits: $50,000 per person, and $25,000 for property damage (They haven't responded to my email to clarify this). Many cars on the road are worth more than $25,000, and it's easy to imagine a highway accident that would involve several vehicles. Never mind that $50,000 of bodily injury coverage is only 10% of the wrongful death damage limit.
And, Maine's minimum limits are higher than most. If you cross the border into New Hampshire, you're packing protection of $25,000 per person. And, don't get us started on Florida, with their $10,000 bodily injury limit per person and $10,000 of property damage.
You Can Protect Yourself
If you have a Maine auto insurance policy with liability coverage, it will cover you after the car share service's policy limits are exhausted, provided that your liability limits are higher than the service's.
If you don't have a vehicle of your own, you can buy "named non-owner's" insurance to protect you. Talk to an insurance agent – including us – about this.
One More Thing…
The car share services typically make you responsible for the first $500 of damage to the shared vehicle. Your Maine insurance policy probably won't help you out with that. Also, read your car share contract carefully. You're probably restricted to listed people driving the vehicle, and on certain types of roads and situations. Know the rules before you get behind the wheel!