Car sharing is a car rental service that allows people to use vehicles for short periods of time, often by the hour.
It can be an economical and eco-friendly option for those who only need occasional access to a vehicle.
On this page
- How car sharing works
- Types of car sharing options
- Benefits of car sharing
- Things to consider when car sharing
- Renting a car vs. car sharing
- Insurance for car sharing services
How car sharing works
Car sharing organizations usually require drivers be at least 21 years of age, with an unrestricted driver's license and a clean driving record.
You can subscribe to car sharing services by opening an account on line or by telephone. Once you've provided the required information to the organization, you can make reservations and have access to a vehicle (often by being given codes or keys).
Some businesses have parked vehicles in numerous locations that allow for self-serve access (after reservations are made). Others have pick-up and delivery options.
Vehicles of various sizes and models may be available. The cost varies depending on the company, length of car rental, distance travelled, insurance costs and usage fees.
Some organizations require drivers to become members and pay monthly or annual fees, in addition to fuel and other rental costs.
Types of car sharing options
Three types of car sharing services are available to Canadian consumers:
Co-op car sharing businesses allow you to buy shares in their organization. In return, you can share input at general meetings and elect representatives to the co-op's Board of Directors.
Owning shares means the upfront cost when joining is higher, but the user fees can be lower those of a private company, depending on your usage of the service.
Private car sharing companies offer car rental services, but do not provide the option to purchase membership shares or participate in the governance of the company.
Another option is peer-to-peer car sharing, where existing car owners make their vehicles available for others to rent for short periods of time.
Peer-to-peer sharing models act as middlemen, bringing two parties together, screening applicants' insurance, managing payments and bookings. With this option, the car owner manages the insurance and typically needs special coverage.
Benefits of car sharing
Car sharing services provide you with various benefits:
- Frees you of car maintenance, ongoing insurance costs, and everyday fuel and parking concerns.
- Gives you 24-hour access, to different types of vehicles, by the hour or day.
- Encourages you to use eco-friendly transportation such as walking, biking, and taking public transit
- Cuts back on daily traffic congestion.
- Helps reduce pollution caused by daily vehicle usage. Some studies estimate that every shared car could replace 15 individually owned vehicles.
Things to consider when car sharing
- Car sharing services are primarily offered in urban areas.
- The service is suitable for those who do not need a car every day and have access to other methods of transportation.
- Each organization operates differently and charges may be calculated in various ways including kilometres travelled, length of time used, fuel consumed or some combination of charges.
Renting a car vs. car sharing
When weighing your options between renting a car and using a car sharing service, think about how often you need the car and the distance you plan to travel.
If the car is only required once in a while, it may be better to rent a car, rather than pay monthly membership fees for a car sharing service.
If you are leaving your city, or going on a trip where the car is required for more than 24 hours, a car rental is often a better option.
For short trips in the city, a car sharing service may be your best bet.
The chart below displays the options of both:
- Hourly rental designed for local use and short-term convenience
- Cost of gas typically included in fees
- Rates are typically by the hour
- No paperwork—reservation and account are usually managed online
- Typically, fees are for each hour used, and another for kilometres travelled
- Usually available 24/7 in public parking lots
- Monthly plans or memberships available to accommodate occasional, frequent or high
- Daily rental–designed for longer distances or multi-day trips
- Customer is responsible for the cost of gas
- Usually pay flat rate for a 24-hour rental plus minimum number of included kilometres
- Longer rental process—customers have to visit a rental office and do some paperwork
- Some companies offer unlimited kilometres for daily or longer rentals
- Car can only be picked up during office hours
- Personal and corporate memberships available for rewards, upgrades, or other benefits
Insurance for car sharing services
While it is required that users have a certain level of driving experience and meet minimum age requirements, insurance for car sharing services differ from company to company.
For example, some organizations require pre-existing insurance coverage while others include insurance as part of the package fee.
In other cases, drivers who have no previous insurance record can build one by using the service.
There may also be an annual fee or a deduction if the driver is involved in an at-fault collision.
Consumers should inform themselves of the insurance costs and policies before participating in a car sharing service.
For more information on car sharing services, please visit http://carsharing.org.
Trusted consumer information
Published by the Consumer Measures Committee, a working
group of federal, provincial and territorial governments, that
helps educate and inform Canadian consumers.
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