New Legislation in Delaware Would Regulate Peer-to-Peer Car Sharing

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Lisa Steuer McArdle
Updated on Jun 27, 2022 · 3 min read
Recently, legislation regarding peer-to-peer car sharing in
passed through two committees in both houses. The bill encourages wider adoption of the practice and establishes basic consumer protections for participants, according to
In fact, Delaware’s Senate Bill 168 seeks to regulate the growing industry in several ways, one of which is to set clear
car insurance
coverage requirements.
Legislation like this is becoming more common, as 15 states already have laws about car sharing on the books.
Delaware’s Senate Bill 168 seeks to regulate the peer-to-peer car-sharing industry.

What is peer-to-peer car sharing?

Peer-to-peer (P2P) car sharing is when a car owner rents their car to others on a short-term basis, and the trend is growing, according to
Automotive World
The concept is fairly simple. It’s almost like an AirBnB but for cars—car owners list their vehicles on a platform, usually through mobile apps. Some of the popular companies in this industry are Turo, getaround, Snappcar, Helbiz, Drivy and Tamyca.
On these platforms, car owners provide information about their car make, model, mileage and year. Interested renters can then find a car that matches their preferences. The P2P websites charge a small commission for every booking.
Many P2P car sharing services offer insurance coverage and 24/7 roadside assistance on the rentals.

Delaware’s new peer-to-peer car sharing legislation

While it’s growing, P2P car sharing is expanding to new markets and as a result, states like Delaware are beginning to set basic consumer protections for both customers and car owners.
Senate Bill 168 requires car sharing platforms to provide
liability insurance
for every transaction. Customers are also allowed to add additional insurance protections from third party insurers.
The legislation also establishes responsibility for car-sharing programs to ensure that no vehicles used for car sharing are subject to
safety recalls
that have not been repaired.
Finally, Senate Bill 168 holds P2P car sharing companies accountable for record keeping, requires various disclosures to consumers, and establishes clear statutory definitions of car-sharing platforms.

A growing industry

The number of P2P car-sharing vehicles globally increased from about 200,000 in 2015 to more than 440,000 in 2020. That number is expected to increase even further in 2025—to about 990,000 vehicles.
One reason for the growth of this industry is probably due to the flexibility it offers. For instance, it’s appealing to those who cannot afford a car, but don’t want to rely on public transportation.
In addition, customers can choose the exact type of car they’d like to rent, usually for less than what a rental company would charge. Plus, interested customers can usually find someone on a car-sharing site right in their own neighborhood.
Car owners also benefit from the service, because renting out your car can help with the costs of loan payments, insurance and maintenance. Some people are even renting out small fleets of cars, turning the practice into a small business model.

More state oversight

As mentioned, Delaware is not the only state that is introducing legislation on P2P ride-sharing companies.
Some lawmakers want these companies to pay the same taxes as rental car companies, for instance. However, many P2P companies argue that they are platforms—not taxi, car rental or transportation companies.

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