Ride Sharing Essay

Background The sharing economy is a recent development in business that has been enabled with the onset of new personalized technology. It is an economy based on collaboration with two or more individuals and makes use of unutilized personal assets. Users that previously had something of value, like an apartment or a car, that was not being used can now share or rent this asset through a business medium. The sharing economy is distinct because the idea of the consumer, producer, and employee is now blurred. Whereas before the consumer and producer was set, the sharing economy now enables consumers to become producers. The growth in this new market economy is tremendous. “Today, it’s been well documented how the sharing economy is experiencing explosive growth. Uber, the company that

While this is an exciting business model, we must look at the implications that this economy brings to the commercial insurance industry. This memorandum will serve as an overview for the current status of the sharing economy in 2015 and the significant risks that it brings. This memorandum will focus on two main parts of the sharing economy: ride sharing and apartment/home sharing and their respective policy implications.
Ride Sharing
Ride sharing has become one of the main focal points of the sharing economy. The most notable companies that are involved in this space are Uber, Lyft and a company on the rise called Getaround. All three companies involve an aspect of renting or sharing their personal passenger vehicles to other consumers for money. The insurance implications for these companies have been substantial to put mildly. These companies hold policies that have a wide variety of coverage gaps and exclusions that exposes the company and the drivers to serious risks and losses. In part, this is due to the industry’s sluggish nature to adopt to these new economic models. “Current