Posted on Wed, Sep 16, 2009
What is a ZipCar? According to it's website, Zipcar is the world's largest car sharing and car club service. It is an alternative to traditional car rental and car ownership. Zipcars are available in many major cities as well as on campuses at universities across North America.
ZipCars are popping up at campuses all over the country and they make a lot of sense for many college students, but if you are under 21 years of age, be sure to address the insurance gap. Whereas ZipCars' insurance coverage for drivers 21 years of age and older provides a $300,000 combined limit for property damage and bodily injury, it provides only the state mandated limits for members 18-20 years of age. In Massachusetts, this is $5,000 of property damage and bodily injury coverage of $20,000 per person and $40,000 per accident. These limits are too low and present more risk than most people can afford to take.
Many people think that their own coverage will back them up, however the Massachusetts Auto Insurance Policy excludes coverage for bodily injury and property damage for regular use or a non-owned car. Because regular use is not clearly defined, efforts to close this gap should be taken. One way is to add a "Use of other Autos - Vehicles Furnished or Available for Regular use" endorsement to the parents' policy. Most carriers will agree to add this endorsement and the cost is usually in the range of $100 - $150 per year. The downside is that the college student must remain as an insured driver on the parents' policy and you do not have the option of removing the student as a driver and saving money while they are away at school.
Another option, which is difficult for a college student to obtain in Massachusetts, is a non-owner auto insurance policy. This would be the only answer for a college student who is not listed on their parents' policy and it could be a good solution for those who are listed because the cost can be less expensive than insuring the student on the family's auto policy for a full 12 months when they are only home 2-3 months per year. Again this can be difficult to obtain in Massachusetts, but it is more readily available in some other states and it can cost as little as $200-$300 per year (Tennessee).
If you have any questions regarding this article or any other insurance issue, don't hesitate to contact our customer service specialists at 1-800-922-8381. At Gaudette Insurance Agency, we are licensed professionals who care about your insurance needs.