The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: El Gringo on May 25, 2013, 10:22:19 AM
-
I'm curious to know what people think about RelayRides (https://relayrides.com/) and other car-sharing sites. Here's my situation:
I have a car that I -barely use. It's a 2000 Toyota Corolla with around 110,000 miles on it. I bought it 3 years ago, I think for around $4000 and with just north of 100,000 miles. I bought it just before I moved to DC for an internship which turned into a job. But shortly after moving to DC, I bought a bike. Over the past 3 years I've fallen in love with biking and now love the challenge of seeing how often I can get away with using my bike, even when I go far out into the suburbs (DC is so bike friendly, and even the car-centric suburbs have great bike paths!). I use my car on average once every 1-2 months (probably closer to once every 2 months) to leave the city and go back to my parents place or to take a fun trip somewhere else. Even when I go back to my hometown, though, I try to car pool with friends who are going back home so that I don't have to drive. Often times I even need to jump the battery when I use it because it's been unused for so long!)
I could easily live without my car. The last time my $300 semi-annual insurance payment came due, I was ready to get rid of my car. But then I decided to sign up for RelayRides and rent my car out. I've rented it out twice and made a little over $60. I've actually gotten TONS of requests, and if I accepted all of them, I could have easily covered the costs of insurance and even made a net profit. However, I'm somewhat nervous about renting it out. RelayRides includes an insurance that covers any damage to the car (up to the total worth of the car) and a $1 million liability insurance. However, I'm still nervous about the liability. What if the medical costs from someone crashing my car go over $1 million? What if I somehow get wrapped up in a court case because my car was involved?
I love the idea and would love to jump wholeheartedly into this, but I'm still nervous about the risk. What do Mustachians think?
-
I'm curious about this too - if anyone has any experience. My neighbor does not own a car - he would like to borrow my car. I'm not comfortable because of the liability issue.. However, I've considered putting my car on relay rides and letting him rent it... Anyone have any thoughts as to why this is a bad idea?
-
I'm curious to know what people think about RelayRides (https://relayrides.com/)
...
However, I'm somewhat nervous about renting it out. RelayRides includes an insurance that covers any damage to the car (up to the total worth of the car) and a $1 million liability insurance. However, I'm still nervous about the liability. What if the medical costs from someone crashing my car go over $1 million? What if I somehow get wrapped up in a court case because my car was involved?
I love the idea and would love to jump wholeheartedly into this, but I'm still nervous about the risk. What do Mustachians think?
Interesting point, you are right to worry about the issue, and this fear of being sued is common. But I would think if you had the car inspected and declared safe ( like a state inspection) and you can demonstrate taking all reasonable care and attention, you will be fine, given their policy as you describe.
The bunny-boiler law-suit scenario is a bit of an urban myth. And you can get a very cheap umbrella policy to help (I have one that covers legal fees if I'm sued). This is much more of an issue with renting houses, btw.
Any lawyers out there?
-
The odds of over $1 million in damages are slim, but an umbrella policy wouldn't hurt if it helps you feel better. Most accidents are $2,000 to $5,000 in property damage + up to $10,000 in medical bills and "pain and suffering." The highest auto policy I've seen is $250,000 per person/ $500,000 per accident. To get to a million, I think you would have to have an accident that permanently disabled a young working parent. Obviously this does happen, but it's not very frequent.
Let's say someone uses your car and the damages do go that high. The driver is liable for those damages, they were negligent, not you. The insurance covers them. You might get sued, but RelayRides will pay for your lawyer, and you'll get out of the case because you didn't do anything that was negligent. If the damages are 2 million, then the Plaintiff should go after the driver's property/wages/other insurance, not yours.
What could you do that would realistically subject you to liability? Allow someone you know is a dangerous driver to take the car (negligent entrustment) or fail to do some maintenance you knew or should have known was required which caused an accident. I assume to rent a car with RelayRides people have to apply and be approved. So RelayRides is probably taking care of the negligent entrustment thing by checking driving histories, etc. If you are worried about maintenance, I would try to drive the car a 10-20 miles once a month to be sure you know how the brakes and steering feel, and take it in for scheduled milage maintenance as recommended by the manufacturer.
So it's not impossible, but it is unlikely. To get umbrella insurance you'll likely have to max or raise the limits on your car and home/renters insurance first, and then get a 1 million policy at about $150 a year. If you think you can make about $1000 a year renting the car, you'll probably come out breaking even with a "free" car to use when you want it.
-
Since you only need a car 4-6 times a year, get rid of yours and rent from a normal provider. You can rent cars for a weekend for well under 100 $ including unlimited mileage and insurance.
that's why I prefer using uHaul instead of having my own truck: it stings on the moment, but the mid and long-term expense is a lot lower.
-
I have a few vehicles I rent on relay rides. I worry a little bit about the liability but all business ventures have their risks and since this one has a low probability, I am willing to take it. The only issue I am running into is that I want to take the cars under my personal insurance and under a commercial insurance. All insurance companies I have talked to turn me down. They advise I would have to have a full up auto rental insurance policy which would cost a lot of money and would duplicate what relay rides is doing for me.
-
I really like relayrides (over renting from other car rental companies) but haven't quite figured out how profitable it would be from an owner standpoint. I'm with you in that liability is probably one of the hardest items to figure out.
-
A friend of mine used to rent her car on relayrides. One of the sticking points is gas.
Typically, you want to give the renter the car with the tank full and have them return it with the tank full.
Unfortunately, most gas gauges are non-linear. They remain on "F" longer than they should, speed through the middle of the gauge and then approach "E" very slowly. This means that a renter can fail to fill the tank properly and you may not notice it. The tank may be less than full, but tha gauge may read "F". With gas at $4+/gallon (depending on location), this can really cut into your profits.