RelayRides, Insurance and a Fatal Crash

In this weekend’s Your Money column, I explore the implications of a fatal accident that occurred when a renter at RelayRides, a car sharing company, had a fatal accident using someone else’s personal vehicle that left four other people injured.

The peer-to-peer car-sharing industry is still in its infancy, and insurance companies don’t actually agree on its implications for your own policy if you are lending out your car, something I addressed in a column last month.

The fatal accident, however, raises a number of questions:

1. Should RelayRides have more than $1 million in liability insurance for people who lend out their cars through its service? Or more than the $300,000 it provides to renters?

2. Should RelayRides reimburse Liz Fong-Jones, who lent her car to the man who crashed it via the service, if she ends up personally liable for any claims?

3. Should Ms. Fong-Jones’s own insurance company, Commerce Insurance, cover her for anything beyond the $1 million that RelayRides does, even though her insurance policy makes it pretty clear that lending out her car the way that she did violates the terms of the policy?

4. Is putting your car in a rental pool like this a bad idea?

I’d like to hear your answers, in the comment section below.