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Renting out your car? 4 things you need to know

Posted August 7, 2013 by Jenny Rose to Insurance 1 0
This post was written by a EasyFinance.com Community member. The views expressed below may not reflect the views of EasyFinance.com.

If you are one of those car owners who prefer to walk, cycle, or take public transport to work, it’s understandable ifyou want to rent your car out. It’s certainly a better proposition than leaving the vehicle lying idle and depreciating in the garage. By renting it to those who need it, you will make some much-needed cash in this tight economy, as well as save on the upkeep costs of your vehicle. And as more and more people latch on to the idea of car-sharing, the monetary returns associated with it will only get bigger.

There are, however, certain things you’d do well to keep in mind before you embark on car-sharing, so that you do not end up becoming a cautionary tale. You can begin by asking some hard questions. Such as:

Do you trust the individual(s) you are renting the car out to?

It sounds great to rent your car to your neighbor’s teenage son for quick cash but do you really know what you are getting into? Do you know if he is a good driver? This is not just about checking someone’s driving record, but also making sure they have the right temperament for being on the road.

How they drive their own vehicle(s) is usually no concern of yours, but it does become so if they are going to be driving your vehicle.Who will pay for the upkeep/repairs of the vehicle?You should hand your keys over to them only if you are convinced they are as good and responsible a driver as your car can get. Otherwise, you may end up in trouble seeing as it’s your vehicle that would get crashed/impounded/harmed if the guy was to have an accident.

Do you trust the agency you are renting your vehicle out to?

Research their background, check out any references they may have on their website of satisfied clients. Speak with these clients if you can get hold of them. Ask them questions that get down to the nitty gritty of it. What are the pros and cons of renting out one’s car? What are the inherent risks associated with such a decision? What if something goes wrong? Get them to give you an honest account. Online testimonials are just gloss,and seldom the true story.

Are you getting the best deal on your rental?

You will have to shop around for quotes to find the best deal for yourself. Some car rental agencies pay very well and include attractive extras in the overall deal. Some let you rent your car for a fixed period, others on a need basis. Some will be more suited to your needs than others. But you will not know this if you settle for the first car-share you come across.

Is your insurance sorted?

We are hoping your auto insurance papers are in order. Still, you need to consider certain what-ifs. If your vehicle was to have a run-in with the law, how would that impact you? What if your vehicle comes to harm or is involved in a bad crash? What would be the car sharing agency’s stand on it? Agencies do provide a comprehensive insurance coverage for rented cars,but even so, check with your own insurer (about a possible conflict in terms) before you decide to list your car for rent.

Renting a car to an agency and peer-to-peer car sharing are only going to get more popular in the days to come. They are a perfect arrangement between those who have a car but don’t need it daily and those who need a car at times but don’town one. Keep the above points in mind if you do decide to become a part of such an arrangement. If you are able to find a good fit for your needs, all the best to you.Not only would you be able to pay for the maintenance of an otherwise depreciating vehicle but also make a bit extra on the side(over the long term).In this economy, every little will help.

About Jenny Rose: This is Jenny Rose. Living in Portland with my husband and 2 cute little kids.  I am an insurance expert and love to gain as well as share knowledge for the same.

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