OAIN: Wash. Law Lifts Auto Insurance Penalties for Sharing Services

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Another bill recently made law classifies usage-based rating formulas as trade secrets, according to Online Auto Insurance News.

The chances you can lend out your car for profit is getting better, with another state adding its final touch on legislation safeguarding motorists from previous uncertainty surrounding liability and vehicle sharing, according to Online Auto Insurance News.

Washington State Gov. Christine Gregoire signed HB 2384 late last week, finalizing laws for programs that rent vehicles to drivers for short periods of time. 

Before HB 2384, drivers with private insurance policies would have had their policies invalidated if they were discovered lending out their cars for money, which is considered a commercial use. The bill now legalizes what some have already been doing: making extra income by keeping the cheaper car insurance policies they can find for personal use while lending out their vehicle to a sharing service. It does so by transferring liability from the owner's insurer to the sharing service's insurer while the car is loaned out.

Legislators said the law would yield "transportation, land use, environmental and social benefits."

"This bill provides certainty in the marketplace for insurance companies, brings businesses into the state, helps the environment, reduces the pressure for more transportation investments, and puts money into people's pockets," HB 2384's supporters, including sponsor Rep. Zack Hudgins (D-S. Seattle), said in testimony backing the law, which follows similar provisions passed in California and Oregon.

The Evergreen State's bill defines a "personal vehicle-sharing program" as "a legal entity qualified to do business in this state that facilitates the sharing of private passenger motor vehicles for noncommercial use by individuals within this state." Such programs are "considered the vehicle owner for all purposes" and hold liability when a vehicle's registered owner turns it over to the program for sharing uses.

Such programs in Washington are mandated to provide at least $180,000 worth of liability coverage total for each vehicle used by the service. Also, a program may not provide less collision or comprehensive coverage than the actual cash value of the vehicle, and its owner must be given the option to buy underinsured and personal injury protection coverage.

The bill protects programs from liability for collisions due to information about a car's condition misrepresented by its owner, while the owner is protected from the cost of theft or damage of equipment used in the car-sharing service.

Source: http://apps.leg.wa.gov/billinfo/summary.aspx?bill=2384

Gov. Gregoire also signed into law HB 2361, which might help give Washingtonians access to Progressive's Snapshot program. The new law allows insurers to label formulas used in conjunction with usage-based devices a trade secret, making them free from public inspection.

Such services usually use an in-car recording device that gathers statistics including miles driven by a driver of the insured vehicle, the times he or she is behind the wheel and driving habits that could reward or penalize those motorists through higher or lower rates.

HB 2361 defines who can collect recorder data and what that data can be used for, including prohibiting sale of the data without an owner's consent.

For more on this and other car insurance issues, head to http://www.onlineautoinsurance.com/cheap/ for access to informative resource pages and an easy-to-use quote-comparison generator.

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