Roy's Rent-A-Car

One of the pluses of practicing insurance coverage and fraud law is learning new things.  Like yesterday.  A claim rep from a major auto insurer called and told me that their insured had "rented" her personal auto from the metropolitan New York City area to a woman from California, who drove to Maryland to pick up her fiancé (at least, that was her story and she's sticking to it) and became involved in a two-car accident, causing physical damage to the insured vehicle, property damage to the other vehicle and injuries to the other vehicle's occupants.  How did the California driver find the NYC insured?  Craigslist.  That's right.  Craigslist.

Now I myself have bought and sold fishing equipment through Craigslist, but have never seen or even considered making my personal autos available through Craigslist for rental to strangers when I'm not using them.  Auto underwriters take notice:  some of your insureds apparently are doing this.  Right now.  Like nursing11[at]hotmail.com in Rockland County.  And this 2005 Toyota Sienna XLE with GPS owner.  Or this 2007 Nissan Maxima with leather seats owner.  There's even a "time-share" car rental intermediary company -- Jolly Wheels -- formed right here in New York that solicits your insureds to "sponsor" their cars for such rentals.

The insurance coverage issues such an arrangement presents are plentiful.  From Jolly Wheels' website (bracketed red text is mine): 

FAQ's for Vehicle Sponsors

How much money will I make?
You decide how much you want to make by setting your own daily, weekly and monthly rate. The lower the rate the more often your car will be rented.

Will my insurance allow someone else to drive my car?
Yes, [Really? You auto insurers out there would be okay with this?] however they may not cover the driver for collision and other liabilities. [This is true.]  Jolly Wheels pre-qualifies all renters for insurance coverage that will carry over to your car. [And exactly what coverages would those be that "carry over" to the owner's car?]

What happens if a renter wrecks my car?
The renter or the renters insurance will pay for it.  [WRONG, even if the driver has insurance, the rented vehicle will be a non-owned auto to the driver; if there is coverage available, it will likely be excess to the owner's insurance.]  Jolly Wheels pre-qualifies all renters for insurance coverage that will carry over to your car. 

Will I ever meet the customers?
Yes. Jolly Wheels will find and pre-qualify [using Fannie Mae mortgage qualification criteria no doubt] renters in your area. Both you and the renter will be given each others phone numbers, and will make your own arrangements for picking up and dropping off [the car, silly].

How do I get paid?
Cash on delivery and Paypal is our preference. [Of course it is.] However check and money order are also available.

What am I responsible for?
Keeping your vehicle registered, insured and inspected. Following through with your pick up and drop off arrangements. [And answering own insurance company's many questions in the event of an accident or loss.]

Liability, physical damage, UM/SUM, and PIP coverage questions abound for losses involving personal autos being rented by insureds to others.  Add to those tort issues when accidents occur in other states.  Check your policies.

And if losses do occur and you have questions regarding the motor vehicle or insurance laws in other states, Martindale-Hubbell state law digests are now available online for free via Martindale.com’s advanced search page.  Enter “Law Digest” in the box marked “Keywords to search for:” and then the relevant state under the “Jurisdiction Search” section.  Anyone using this website will need to register the first time.  It’s free.

Now where did I save my craigslist username and password?  Anyone need a 2008 Tahoe for the weekend?