Dude, where's my car share?

New legislation could make it easier for people to share their cars
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By Brady Welch

news@sfbg.com

GREEN CITY Owning and storing a car in San Francisco is neither cheap nor efficient, so car-sharing companies have become increasingly popular in recent years. So why can't individual car owners share or rent their vehicles? Right now, insurance law makes that difficult, but new legislation could make it easier for people to share their cars.

California Assembly Member Dave Jones (D-Sacramento), a candidate for Insurance Commissioner, unveiled the legislation during an April 28 press conference in San Francisco. Flanked by City CarShare CEO Rick Hutchinson and Sunil Paul, chief of a car-sharing start-up called Spride, Jones outlined legislation that would allow car owners to rent their vehicles to car-sharing organizations without risk of losing their individual auto insurance. Think of the idea as a more decentralized — but not quite DIY, at least not yet — version of other successful car-sharing organizations.

Hutchinson said there would likely be little difference between current City CarShare members' experience and these new ventures. The change would be most significant in less dense areas where economic and logistical conditions prevent companies like City CarShare from expanding. By contracting with individual car owners, Spride is proposing to cut out much of the financial and logistical overhead, bringing the benefits of car sharing to a wider array of people. Folks would still reserve vehicles online or over the phone, and the cars would be maintained and tracked using City CarShare's technology.

Vehicle owners could potentially earn "hundreds of dollars" per month through Spride, Paul said. Although owners wouldn't be able to set their own rates under Spride's pilot program, Paul did mention the possibility of pricing "flexibility" if the model proves successful. Owners would set the hours for the vehicle's availability.

California law is unclear about the insurance ramifications of individual car sharing. The snags concern commercial use of the vehicle and insurance liability. Currently, if you charge people to borrow your car, insurance companies can technically revoke your insurance. This, in turn, leads to the issue of whose insurance policy covers the person who is driving at any given time.

Jones' bill would clarify that. "Participating in car sharing is something we want to encourage," he said. The legislation would specifically define personal vehicle sharing in car sharing organizations as noncommercial usage. This is significant because commercial insurance is more expensive than personal insurance. By "expanding what City CarShare has pioneered" with the company's technology and network of members, Jones said that California can "take it to the next level" by promoting and expanding the practice to new markets and individuals.

Even so, the bill still doesn't address the ramifications of person-to-person car sharing, so don't rush off to Craigslist in hopes of renting out your Pinto for some extra scratch. It's still legal to lend your car to friends and family for free, but if donations are offered, you might want to keep that secret from your insurer.

The Association of California Insurance Companies opposes Jones' legislation. But according to ACIC vice president Mark Sektnan, amending it could bring the group's members on board. "We want to make sure that people who put their cars into these operations are protected. And we want to make sure the car sharing organization fixes" the vehicle if it's involved in a crash. As currently written, the bill only provides the car owner with liability insurance. Sektnan wants something more comprehensive.

Comments

Dave Jones for Insurance Commissioner Campaign
NAME OF CONTRIBUTOR - PAUL SUNIL
CEO/SPRIDE - SPRING VENTURES VENTURE CAPITALIST
CITY - SAN FRANCISCO CA / 94117
AMOUNT TYPE - $6,500.00
TRANS. DATE - 5/19/2010

Posted by F PPC on Jun. 01, 2010 @ 11:24 am

I am still waiting for the new legislation to come in place, hopefully it will have a direct effect on the number cars used in the city. The car sharing project is getting more and more popular and I couldn't be more glad about it, this is the perfect solution for more problems.

Posted by car donation on Mar. 05, 2011 @ 10:32 am