Insurance Must-Knows for Car Share Hosts (Turo and GetAround)

correct insurance plans for car share hosts on turo and getaround

The importance of insurance when car sharing on Turo and GetAround

Hello guys!

I want to preface by saying that I am not a licensed insurance agent/broker. Any information I provide here should be doublechecked with your own agent before you apply anything you learn in this article.

That being said, I believe that the topic of insurance is a topic that should be of utmost importance to hosts that want to expand their fleet. I have commercial insurance for my own fleet but originally started off ensuring my fleet using my personal insurance policy. This can have huge implications later down the road, so make sure you start your business on the right foot.

If you’re a new host that hasn’t signed up for Turo or GetAround use my links and receive free Turo course access.

sign up for getaround!

Protecting yourself when renting cars out of car sharing platforms

While most of you are likely in the early stages of your Turo career, you still need to take into consideration what type of risk you are exposing yourself to. Ask yourself: how would you feel if you were hit with a million dollar lawsuit? If you’re a normal person, it would probably send a shiver down your spine!

By renting out cars on Turo and GetAround you potentially expose your personal assets to litigation if a guest gets into an accident. While these car sharing platforms proudly state that they offer a 1 million dollar liability policy, there are many ways where you may not be covered that are not so obvious.

A few hosts learned the hard way when they found out even though they pay 25% of delivery fees Turo insurance only provides liability insurance during the delivery!

Before we jump into the topic of insurance, I want to stress the importance of registering an LLC or corporation before expanding your fleet. It’s a very simple process and will act as a safeguard for your personal assets when you are renting your cars out.

Protecting your hard earned assets in the case of catastrophe

Another benefit of registering a company is the separation of personal and business credit. If you buy a bunch of cars in your name you will eventually exhaust the limits of your credit. This results in you being denied for mortgages and other important loans!

If you start by buying cars in your company name you will not be handcuffed when it comes to potential expansion plans. Using personal credit to acquire cars was one of the biggest mistakes when I first started!

A common misconception of business credit is that you have to have 2 years history in order to get approved for a loan. This is true, but for many banks, they will allow you to personally guarantee the loan! Make sure you check which banks do not report to your personal credit.

Why you shouldn’t use personal insurance for car sharing¬†

Your current scenario: Using personal insurance to cover your Turo fleet

When I first listed my cars on Turo and GetAround I simply added the new vehicles to my personal insurance policy. It seemed like a no-brainer for me, the incremental costs of the adding these vehicles were almost insignificant!

In one case, I added a 2019 Corvette and my total insurance premium actually went down. I don’t know how the underwriters figured that one out by frankly I didn’t care.

I want to tell you that in times of sunshine this is a very attractive option to use.

However, if anything goes sideways – you will be stuck with a huge loss that even the most wealthy of you would feel.

But the incident happened when I was using it for personal reasons!

That’s a common statement from hosts that believe that they are covered by their insurance providers.

It’s generally not the case! Remember, when you paid your premium they calculated the risk based on PERSONAL use. Once you rent out your vehicle for monetary gain that use gets classified as commercial use. This means that from the moment you received your first guest, the insurance policy is void due to you violating the terms of the policy.

For most hosts with a couple of cars, it is unlikely that the insurer will find out about your illicit activities.

How a hard-working entrepreneur could face huge liabilities resulting from incorrectly insuring

To simplify things: consider this situation. Granny Smith maxed out her insurance policy with 9 vehicles. Among them a Prius and a 2019 Lambo Truck.

insuring high value assets like this is important when car sharing
We all wish we could have a fleet of these monsters!

She has been with this insurance broker for the past 10 years and before she began renting out her cars on the platform she only had her decade-old Buick. After hearing about the “Airbnb for Cars” Granny Smith decided to rent out her car on the car sharing platform. She quickly made a ton of money!
Excited, she decided to expand her fleet with purchases like muscle cars and high-line luxury.

It all goes well and she starts making quadruple what her social security check brings in. She’s jumping for joy!

Then it happens……the day comes where she’s driving her Lamborghini to shop for groceries after returning from a music video shooting for Lil Pump.

She isn’t paying attention and hits a parked car! She realizes that Turo only provides liability insurance while on a delivery, so Granny Smith knows the only way she can be covered for the incident is by reporting to her insurance.

What is the Lamborghini made of? Granny was only going 5 MPH!

So she reaches out to Geico to report the incident. She gives a statement and is assured she has nothing to worry about as she purchased comprehensive insurance. Granny Smith is very relieved and the next day she drops the car off at the dealership to get fixed.

Weeks past and Granny Smith has resumed business as usual. She gets a call from an insurance adjuster that is looking at the incident. The adjuster asks her the usual questions: why she was there that day, what she was doing, and how she hit the car. Granny Smith is careful not to mention that she rents out the car on Turo and GetAround.

The adjuster believes her and then ends the call. He then notices something strange…..the lady she was talking to doesn’t seem like the target demographic for the new Lambo truck and proceeds to take a look at her policy.

The trouble begins: incorrect coverage is being revealed

He notices that she has a wide assortment of vehicles! Bewildered, the adjuster calls her back and inquires about a large number of insured vehicles. While he doesn’t suspect commercial use yet, he is starting to suspect that she is potentially insuring the car and another individual is the primary driver.

The adjuster now digs deeper, and Granny Smith’s story begins to unravel. Her answers are no longer sufficient and the adjuster requests the mileage driven on her various cars. The total number of miles turns out to far more than what she could drive herself. The gig is up! The adjuster deems that they vehicles were either driven by an unauthorized driver or used for commercial purposes.

The adjuster now denies the claim pending additional evidence of personal use. Granny Smith now has the burden of proof, or else she is stuck with thousands of dollars of repairs.

While this situation is hyperbole, I hope it sheds light on a situation where using personal insurance could result in a catastrophe.

As a business owner, you need to determine what levels of risk you find acceptable. Some of you may decide that using personal insurance is a risk you’re willing to take, but I want you all to be aware of that risk for you to make a calculated decision.

Finding commercial insurance – a Labyrinth of Uncertainty

Now that I’ve scared you enough let’s talk about how a host can find proper coverage for their rental fleet.

Please note: Most traditional insurance providers require you to have at least two years of operation and loss sheets before they will consider providing commercial coverage for your fleet.

If you’re like me and have never been in the rental industry before Turo, you will need to find an insurer willing to provide cover.

I’ve found that there are usually two options that are useful for hosts.

Hybrid insurance: Personal insurance plans that will charge you for each personal mile used. They install a tracker and will bill you depending on personal usage. This is the cheaper option for most hosts. Check with your insurance provider to see if this is available. I know some very large insurers have begun to offer this type of policy as long as it is indicated at time of policy formation.

Standalone modified commercial insurance: The most prominent commercial insurance that large car share host use is US Choice.

US Choice is effectively a group-buy insurance plan that will provide cover to hosts that meet certain requirements.

I use David Bond at GMI Insurance – tell him Jerry at SharingEconomySecrets sent you!

US Choice requires its insured to verify that renters have their insurance policy. This reduces the risk by denying coverage to renters who are either international visitors or drivers who are unable to obtain coverage.

Choosing this type of policy has its drawbacks. Your potential renter pool is cut down significantly due to only being able to provide cover for a certain type of renter.

Never fret, if you do have this policy you will still be able to rent out your cars to most renters by having them sign up for the car share platform of your choice. You might even score $25 in credit for yourself!

I’ve found that this insurance plan is not only applicable to my use but also potentially cheaper than personal insurance! As a host that is under 25, my insurance premiums dived when I switched to this commercial policy. On top of that, I have found organic customers as well as referrals, and by being able to provide my insurance, I have rented out cars at almost 100% more than what I would have received on Turo or GetAround!

sample car share commercial insurance contract

Note: your quoted insurance rate will be dependent on where you live, your driving history, and a confusing number of other factors.

If you’re very worried about damage risk when offering this coverage to your renters, you can have them purchase add-ons like damage waivers for around $20 per day. I haven’t used any that type of protection, but if your guest insists just know that it should be available for purchase. Inquire with your insurance broker to see if they provide such offerings.

Commercial coverage opens doors to other avenues of growth:

While a modified commercial fleet insurance plan won’t by any means be your golden ticket, it enables you to begin seeing what running a rental operation truly entails. You’ll be responsible for ID verification, insurance checks, and other FUN activities!

If you can make it past these trials, you will be rewarded handsomely. Perhaps after two years, you can eventually be approved for the traditional commercial insurance coverage that Rent-A-Car companies use!

Thank you for reading and I hope you have found this article to be informative. Check out our other car sharing articles for other useful tips. Post a comment if you have any tips that you want to share with fellow hosts!

Facebook Comments


  1. Can you please advise some banks that will offer a loan to your LLC without reporting to your personal credit?

  2. Essentially, aside for setting up an actual rental car company that forces the renter to sign additional documents, there is no actual fully legal solution to getting commercial insurance for a car you are listing on Getaround or Turo? Is that correct?

Leave a Reply

Your email address will not be published.