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Today’s gig economy has changed the way we think about transportation and accommodations. Instead of calling a taxi, you might use a ride-sharing service such as Uber or Lyft. Instead of a hotel, you might opt for an apartment or home found on VRBO or Airbnb.

As these services grow, so do the risks

Most of the news coverage of what can go wrong has focused on ride-share drivers who had negative experiences with passengers, or homeowners who had difficulty with the individuals who rented their home or apartment. Much less attention has been paid to the risk that people face when using these services.

Here are a few things to consider:

  • The ride-sharing service might not make its drivers carry adequate insurance coverage, leaving you responsible for the cost of treating any injuries incurred in an accident1
  • An injury could keep you from working for a few weeks, costing you a substantial amount of income
  • Because drivers don’t have workers’ compensation insurance, they might sue you as the passenger if an accident happens

You share the responsibility

There’s a certain amount of risk associated with people using their private vehicles as paid transportation, and not being aware of those risks can be costly to you as a passenger. Why? Because typically ride-sharing companies carry a $1 million liability policy on drivers — a level that might not cover all of a passenger’s needs in the event of an accident.

Turo is a leading peer-to-peer car rental network that offers a range of makes, with Business Class vehicles from makers such as Tesla, BMW, Toyota and more. The Deluxe and Super Deluxe stable has high-end brands such as Bentley, Porsche and Mercedes-Benz.

Turo’s plan offers only $1 million in coverage. You should be aware that this applies only to vehicles insured through Turo’s plan.2

Your home away from home

The many options offered through sites such as Airbnb, HomeAway and VRBO (Vacation Rentals By Owner) have given hotels significant competition. The rates offered by individuals renting their homes or apartments are usually much less than those at hotels, and there’s a greater selection of amenities and options.

Tips to help minimize the risks:

  • Book only places with hosts that have a strong reputation and good reviews, and verify phone numbers, social networks and references
  • Walk away if there is anything deceptive; in some cases, individuals representing themselves as the owner have rented out properties or vehicles that did not belong to them3
  • Avoid putting yourself at risk for fraud; communicate only through the channels offered by the company, even if the host recommends another form of communication4
  • If the property seems unsafe or isn’t as advertised, you will need to contact the company immediately to try to resolve the matter

If you have any questions, please contact your agent or Nationwide Private Client Risk Solutions professional. For more information on how you can help prevent losses, visit: nationwide.com/solutionseries

[1] “Uber or Lyft Accidents – Your Rights as a Passenger,” Ingerman & Horowitz LLP, ihlaw.com/uber-or-lyft-accidents-your-rights-as-a-passenger (Aug. 18, 2016)
[2] “Ride-sharing carries real risks for wealthy individuals and families,” InsureScope, insurescope.com/ride-sharing-carries-real-risks-for-wealthy-individuals-and-families (July 12, 2017.)
[3] “The Pros and Cons of Using Airbnb,” Investopedia, investopedia.com/articles/personal-finance/032814/pros-and-cons-using-airbnb.asp (March 3, 2016)
[4] “I’m a guest. What are some safety tips I can follow?” Airbnb, airbnb.com/help/article/241/i-m-a-guest--what-are-some-safety-tips-i-can-follow (June 2, 2018)