Peer-to-peer car sharing apps let you rent your own car to another driver for a fee. The question most owners skip is what their personal auto policy does while a stranger has the keys. In Tennessee, the answer starts with Tennessee Code § 56-7-1120.
The statute says an insurer that writes motor vehicle liability insurance in the state may exclude any and all coverage, and the duty to defend or indemnify, for any claim under a shared vehicle owner's motor vehicle liability policy. That can include liability for bodily injury and property damage, uninsured and underinsured motorist coverage, medical payments, comprehensive, and collision.
The word is "may." Some policies exclude car sharing and some may not. Your policy language decides which applies to you.
| Topic | What § 56-7-1120 says |
|---|---|
| Personal auto exclusion | An insurer may exclude any and all coverage and the duty to defend or indemnify under a shared vehicle owner's policy |
| Coverages that can be excluded | Liability (bodily injury and property damage), uninsured and underinsured motorist, medical payments, comprehensive, collision |
| Required to cover? | A personal auto policy is not required to provide coverage during a car sharing period |
| When the period runs | From the car sharing delivery period (or start time) to the car sharing termination time |
| The program's stake | The car sharing program has an insurable interest in the shared vehicle during the car sharing period |
| Claims between insurers | Program, owner, and driver insurers must disclose to each other their coverage, exclusions, and limits |
| Buying coverage back | An insurer may still choose to cover a program or a shared vehicle owner by contract or endorsement |
Source: Tennessee Code § 56-7-1120.
When the car sharing period starts and stops
The exclusion is tied to the car sharing period. Under the statute, that period commences with the car sharing delivery period and ends at the car sharing termination time. If there is no delivery period, it runs from the car sharing start time to the termination time.
The termination time is the earliest of several events. One of them is when the shared vehicle owner, or the owner's authorized designee, takes possession and control of the shared vehicle. Gaps in that timeline, such as a late return, are worth asking about before you list the car.
Where the program's insurance fits
Tennessee says a peer-to-peer car sharing program has an insurable interest in a shared vehicle during the car sharing period, and the program may own and maintain its own motor vehicle liability policies. What those policies cover, and for how much, comes from the program's terms, not from your personal policy.
The statute also says the insurers of the program, the owner, and the driver must disclose to each other a clear description of the coverage, exclusions, and limits in their policies during a claims investigation.
Questions to ask before you list your car
- Does my policy exclude car sharing, and does it define the period the same way the statute does? Start with your declarations page: TDCI glossary: what your insurance declarations page shows.
- Is an endorsement available that adds coverage for car sharing? Background on endorsements: TDCI glossary: an endorsement can expand or limit policy benefits.
- What liability limits and physical damage coverage does the app's program carry, and who pays the deductible?
- Does my lender or lease require collision coverage at all times? TDCI’s glossary separates collision coverage from comprehensive coverage.
- How do my liability limits compare with Tennessee minimums? Tennessee’s auto liability minimum is 25/50/25 — here is what TDCI’s Auto Insurance 101 page says.
- Ride-hailing is a different setup with its own gaps: TDCI warns Tennessee TNC drivers about rideshare liability and personal-auto gaps.
This article is informational only. It summarizes Tennessee Code § 56-7-1120 and does not promise coverage or eligibility. Your auto policy and the car sharing program agreement control.
Related reading from All Seasons
- TDCI warns Tennessee TNC drivers about rideshare liability and personal-auto gaps.
- TDCI’s glossary separates collision coverage from comprehensive coverage.
- TDCI’s glossary defines uninsured and underinsured motorist coverage.
- Tennessee’s auto liability minimum is 25/50/25 — here is what TDCI’s Auto Insurance 101 page says.
- TDCI glossary: what your insurance declarations page shows.
- TDCI glossary: an endorsement can expand or limit policy benefits.
- TDCI’s glossary explains gap insurance for auto loan balances.
Free policy review
All Seasons Insurance Group offers a free personal policy review. Call 865-263-1400 or visit asigtn.com/get-a-quote/. This article is informational only and does not promise coverage or eligibility; your policy forms control. Seasons change. So should your coverage.
Can my Tennessee auto insurer exclude coverage when I share my car on an app?
Yes, it may. Tennessee Code 56-7-1120 lets insurers exclude any and all coverage and the duty to defend under a shared vehicle owner's policy.
Which coverages can be excluded during car sharing?
The statute lists liability for bodily injury and property damage, uninsured and underinsured motorist, medical payments, comprehensive, and collision.
Does Tennessee require my personal policy to cover car sharing?
No. The statute does not require a personal auto policy to provide coverage during a car sharing period.
When does the car sharing period begin and end?
It begins with the car sharing delivery period, or the start time if there is no delivery, and ends at the car sharing termination time.
Does the car sharing app have its own insurance?
A program may own and maintain its own motor vehicle liability policies. What they cover depends on the program's terms.
Do the insurers share information after a crash?
Yes. The program, owner, and driver insurers must disclose to each other a clear description of their coverage, exclusions, and limits.
Can I buy coverage for car sharing on my own policy?
The statute lets an insurer choose to cover a shared vehicle owner by contract or endorsement. Ask whether one is offered.
How can All Seasons help after reading this?
Call 865-263-1400 or visit asigtn.com/get-a-quote/ for a free personal policy review. Informational only; no coverage promises. Seasons change. So should your coverage.
