Renting out your basement for some extra cash sounds like a good idea to many. Cars, though, are another matter. Some people won’t even hand over the keys to their family members.
David Brown has grown used to friends reacting incredulously when he tells them he’s been letting strangers drive around in his 2016 Tesla Model S for about $100 a day. But he has zero regrets, he told Global News.
READ MORE: Airbnb for cars: Turo launches in Canada, lets people rent out their vehicles
The 41-year old Toronto-based sales manager is part of a small but growing community of Canadians who have embraced Turo, the first app in Canada for car-sharing.
That’s right: car-sharing, not ride-sharing. While Uber and Lyft let car owners earn some money by driving others around, Turo is about letting users sit behind the wheel.
The company, which launched in the U.S. in 2009 under the name RelayRides, came to Canada in April of last year, setting up shop in Quebec, Ontario and Alberta. Today, it counts around 180,000 users and 4,500 available cars.
READ MORE: Turo app, dubbed AirBnB for car rentals, comes to Calgary
Turo is the only online marketplace for private car rentals in Canada, though U.S.-based competitor Getaround promises on its website it will also cross the border “soon.”
WATCH: Car-sharing company Turo comes to Canada
How it works
Turo is very much like Airbnb. Car owners need to snap a picture of their ride and register on the app, setting availability and a daily rental rate. On price, users can let Turo’s algorithm decide based on model, demand and time of the year or pick one themselves. Turo pockets between 15 per cent and 35 per cent of the trip price, depending on the vehicle protection package users choose.
Car owners are notified when someone inquires about their vehicle or books instantly.
READ MORE: Here’s what happens to your car loan if interest rates rise
Notably, Turo vets every traveller, Cedric Mathieu, director of Turo in Canada, told Global News. The company verifies the validity of users’ drivers’ licences and occasionally checks criminal records for users its system flags as potentially high risk.
Still, users are free to decline any rental requests they don’t feel comfortable with.
Car owners also have the choice of telling guests where to pick up the vehicle or delivering it themselves.
READ MORE: 3 numbers you should check before deciding whether to lease or buy a car
Renters
Renters must be 21 or older and submit a valid driver’s licence. Those under 25 also need to show at least two years of driving history in the U.S. or Canada.
As with any rental vehicle, both lessor and renter are supposed to check the vehicle for damages, fuel level and mileage before and after the trip.
After all is said and done, both parties get to review each other on the app, which “is a key piece of establishing trust,” said Mathieu.
WATCH: Five tips you need to know when buying a used car
What about insurance?
Turo offers $2-million liability coverage through a commercial insurance policy provided through Intact Financial Corp. and its subsidiary Belairdirect. The commercial policy kicks in from the moment the car owner sets out to deliver his or her vehicle to the renter (if they chose to do so) to the end of the trip. Whenever the car isn’t being used via Turo, it is covered by the owner’s regular insurance company.
The catch is that most insurers don’t allow customers to rent out their vehicle under non-commercIal policies. In fact, when Turo started out in Canada, only car owners insured by Intact and Belairdirect were be eligible to list.
Things have changed since, then, though. A number of insurers, including Desjardins Insurance and State Farm, have modified their policies to allow participation in peer-to-peer car rental. Turo is in talks with others it hopes will soon implement the change as well, Mathieu told Global News.
READ MORE: New app could save consumers money on car insurance depending on how they drive
Users need to check in with their insurance to verify eligibility and everyone, regardless of who’s providing their personal car insurance, should contact their providers to let them know they’re participating in peer-to-peer car sharing, said Mathieu.
Insurance issues have landed Turo in hot water in the past.
In its previous incarnation as RelayRides, the company ran into trouble in New York state, which has not approved commercial auto insurance policies that supersede personal policies.
“Innovation, by its nature, doesn’t always fit within existing structures. Although we’ve been careful to ensure the protections offered to our community comply with legal frameworks around the country, we learned in conversations with the New York Department of Financial Services that it believes there is noncompliance with certain unique aspects of New York insurance law. Since 2013, we have been working with New York state representatives to bring Turo back to New York, ” Turo CEO Andre Haddad told Global News via an emailed statement.
READ MORE: SGI considers penalizing drivers who leave their keys in vehicle that is stolen
Insurance regulators in Quebec, Ontario and Alberta, however, have no such qualms. This new type of insurance is legal in these three provinces.
Asked by Global News about flagging any consumer concerns around car-sharing, regulators only urged users to verify eligibility under their current policy and leasing or financing agreements, alert their insurance providers and discuss any potential drawback with insurance agents or brokers.
Turo is in talks with other provincial regulators in order to expand its reach to other parts of Canada, Mathieu said.
WATCH: Is rental car insurance a necessity or a luxury?
What’s in it for car owners and renters?
Much like an empty basement, a parked car is an underused asset that could be making you money, said Mathieu. The average car is sitting idle more than 90 per cent of the time, he noted.
In Canada, where vehicle values depreciate faster due to severe weather, that’s an especially big waste, he argues.
In the U.S., car owners who rent through Turo make an average of US$600 (C$755) per month, according to the company. In Canada, it estimates average potential earnings at $500 a month.
Of course, it all depends on how much renting you do and when.
Brown, who uses Turo for both his Tesla and a Volvo XC90 SUV, told Global News he makes $2,500 a month. That’s more than enough to cover the monthly payments for one car, including insurance and parking.
READ MORE: Tesla is set to release a car for a price the masses might actually afford
“It’s like having two cars for the price of one.”
For renters, one of the main perks is affordability, according to the company.
A look at Turo’s Toronto website shows a number of cars available for less than $55 a day, including a 2013 Fiat 500 and a 2010 Mini Cooper.
The other big attraction is the possibility of driving luxury and sports vehicles. Brown’s Tesla Model 2 goes for $112 on a Thursday, though he told Global News the price usually goes up on weekends.
Other fancy rides you can get your hands on it Toronto include a 2016 Maserati Ghibli ($254 per day on July 20) and a 2015 Chevrolet Corvette ($218 per day on July 20).
WATCH: Napanee, Ont. woman, 30, charged after child left alone in hot car in Belleville: police
What users say
If you rent out your car, something will happen to it, sooner or later.
One U.S. user told the New York Times his Jaguar was damaged three times and totalled once during 29 rentals.
Another U.S.-based car owner wrote on Travel Codex that his car was stolen (and quickly recovered) during a Turo trip on Christmas Day. The owner recounts a positive insurance experience and vows to keep on renting.
Brown said he went through three insurance claims for minor damages, out a total of 110 rental trips on his two cars. Turo was very responsive and he didn’t pay a dime, he said.
In one other instance, though, a renter returned his Tesla with a strong smell of cigarette smoke.
WATCH: Tesla taxis hit road in Kelowna
Brown failed to notify Turo within 24 hours, which meant he stood to pay out of pocket for the cost of treating the car’s interior. But Turo volunteered to pick up half of the tab, he said.
In all, he tells Global News, his experience with the company has been “great.”
Besides the extra income, he enjoys the camaraderie that has formed among Turo users, both car owners and travellers, who now include some repeat customers.
“It’s a pretty cool little community.”
Comments