Last Updated on December 10, 2025

The idea of sharing rides or vehicles isn’t new—but digital technology has transformed it. With gas prices hovering around $3.50–$4.00 per gallon and sustainability top of mind, peer-to-peer (P2P) car-sharing has exploded in popularity. Instead of simply carpooling with coworkers, many drivers now rent out their personal vehicles through apps like Turo, Getaround, and Avail.

This growing “Airbnb for cars” model raises a big question: how does auto insurance work when your car becomes a mini rental business? Let’s explore what peer-to-peer car sharing means, how insurance applies, and what’s changed recently.

Key Takeaways

• Personal insurance usually doesn’t cover car-sharing rentals. When you rent out your vehicle for profit through apps like Turo or Getaround, your standard personal auto policy typically excludes coverage for accidents or damage.
• Most platforms now provide their own insurance coverage. Major P2P companies partner with insurers like Liberty Mutual and Assurant to offer up to $1 million in liability coverage and varying levels of physical damage protection.
• State laws are catching up to the car-sharing trend. Over 20 states now regulate P2P car-sharing, requiring platforms to provide clear insurance coverage and disclose who is responsible in case of an accident.
• Car owners should still review all policies carefully. Even with platform coverage, it’s important to confirm what’s included, what’s excluded, and how claims are handled to avoid unexpected costs or policy cancellations.

What Is A Peer-to-Peer Car Sharing Program?

A peer-to-peer car-sharing program, or P2P as it is commonly referred to, is a program that allows individuals to become members and share their cars with total strangers by renting them out on an hourly or daily basis. Also, if someone does not own a car, they can join the program and borrow cars on an as-needed basis for a fee. Many programs charge an initial membership fee and conduct background checks, but members then have access to a database listing availability. There are for-profit and non-profit programs, and most programs offer some form of insurance coverage as well.

Popular peer-to-peer car-sharing platforms in the United States now include Turo, Getaround, Avail (owned by Allstate), Kyte, and Uber Carshare (formerly Car Next Door). Some older programs, such as Maven and Enterprise CarShare, have since shut down or merged into other mobility initiatives.

Insurance Concerns

For anyone thinking of renting out their personal vehicle, understanding the insurance implications is critical. Most personal auto insurance policies exclude coverage if you’re earning income from renting out your car. That means your regular insurer could deny any damage or liability during a P2P rental.

Fortunately, most platforms now include built-in commercial policies underwritten by major carriers. For example, Turo partners with Liberty Mutual, and Getaround provides coverage through Assurant. These policies typically include up to $750,000–$1 million in liability coverage and varying levels of physical damage protection.

Still, it’s important to review both your personal policy and the platform’s coverage agreement. Some insurers now offer special endorsements for hosts, closing the gap between personal and commercial use.

Also, when your car is driven by many different drivers under varying conditions, it increases the risk of an accident to your personal vehicle. One factor in determining an insurance policy is how the car will be used. Loretta Worters, vice president of communication at the Insurance Information Institute, says that ‘Some insurers view car-sharing services as a higher risk, so they may cancel or not renew a driver’s car insurance policy or increase premiums if a policyholder’s vehicle is involved in an accident while it’s being rented.”

Liability and depreciation are areas of concern. If a car owner who has not maintained their vehicle correctly rents it out and an accident occurs due to poor upkeep, which policy covers the damage? It is not known whether all P2P programs require a vehicle inspection before renting. A law in Oregon that covers car-sharing states that the car-sharing company has the right to pursue the car owner for liability for any damages if it appears the car’s condition was misrepresented.

It also can’t be guaranteed that everyone will handle an owner’s car with the same regard. Normal wear and tear happens much faster when 15 people are driving a car in various situations versus one person commuting to work every day. Also, if major damage occurs to the car the P2P insurance may cover the damage, but the value of the car may depreciate something a driver is ultimately stuck with.

Insurance Companies on Peer-to-Peer Sharing

The insurance industry has evolved quickly to keep up with P2P sharing. Nowadays, most major insurers recognize that this market isn’t going away. Instead of canceling coverage, many now offer specialized products for hosts or renters who regularly participate in car-sharing.

Even so, coverage limits and deductibles vary widely, and hosts should still confirm how claims are handled. For instance, Turo’s “Premier” plan offers $750,000 in liability coverage and low deductibles, while cheaper plans provide less protection.

States like California, Illinois, and Maryland have enacted P2P car-sharing laws requiring clear disclosure of insurance responsibilities and mandatory liability minimums—ensuring that both car owners and renters are protected if an accident occurs.

New York Times columnist Ron Lieber wrote an article addressing concerns insurance companies had about these new developments. After contacting several large insurers, he had this to say:

“They want you to know that RelayRides (now known as Turo) insurance won’t be adequate in the event of a catastrophic accident and that your own insurance company may take away your insurance if it even hears that you are lending your car to someone in exchange for a few dollars an hour.”

While these were Ron’s words, that general statement reflects the state that Liz Fong-Jones found herself in after renting her car through RelayRides (now known as Turo). The renter, driving the wrong way down a road, collided with another vehicle carrying four passengers, all of whom sustained serious injuries. While RelayRides (now known as Turo) provides a $1 million/ accident coverage policy and reimbursed Ms. Fong-Jones for her totaled car, the injury claims for all four passengers may total over $1 million when everything is settled. Who pays for that?

States such as California, Oregon, and Washington have recently passed laws to address insurance and liability issues not only for vehicle owners but also for P2P programs, setting a better standard when the unforeseen happens. If programs such as this are available in your area, it is highly recommended that you research the potential consequences they could have on your insurance policy.

FAQs

Final Word

Nowadays, more than 20 U.S. states have enacted legislation outlining how peer-to-peer car-sharing insurance should work. These laws often clarify that the platform’s policy is primary while the car is rented, protecting both the owner and the renter.

If you’re considering renting your car on Turo, Getaround, or another service, review your coverage, understand the platform’s terms, and check your state’s latest laws. As this industry grows, insurance options are becoming more flexible—but understanding the fine print remains essential.