Arrangements for insurance – that most prominent of stumbling blocks for new sharing economy players – had already been squared away when American company Turo made its announcement yesterday of its launch in Ontario, Quebec and Alberta.
A national launch is planned once insurance issues have been resolved in the country’s remaining provinces.
The U.S. company has an agreement in place with Intact Financial Corp. to make insurance coverage available for its venture north of the border via Intact’s two biggest brands, Intact Insurance and Belairdirect. Every rental is backed by $2-million in auto liability insurance.
“Consumers want to participate in services like Turo,” said director of external relations for Intact, Stephanie Sorensen to one media outlet. “We want to ensure that insurance coverage is available.”
The company model calls for car owners to rent out their vehicles to strangers, generating a revenue stream for the owner from an underutilized vehicle. According to the company, the average active vehicle owner south of the border makes roughly $600 per month. For renters the rates offered are substantially lower than the equivalent from conventional car-rental outlets. Both owners and renters must pass a company-conducted screening process.
In common with Uber, Turo vehicles must be relatively recent – less than 10 years old – and have fewer than 200,000 kilometres on the odometer to qualify. The company already has operations in 2,500 cities and 300 airports. Turo says that is has more than a million rental days to its credit so far.
“We like to think of our mission as one aimed at putting the world’s one billion cars to better use,” chief executive officer Andre Haddad said Tuesday.
“There are a lot of cars that may at one point in their life cycle be underutilized. That’s a lot of economic waste.”