Saturday, May 03, 2008

Zipcar Finally Gets Insurance Right

My earlier post from February 2007 was highly critical of the deceptive way that Zipcar was talking to members about their insurance coverage. One of the side effects of the Flexcar - Zipcar merger/buy out was that Zipcar inherited Flexcar's insurance and started offering it system wide.

So I'm pleased (and overdue) in reporting that Zipcar is now telling it like it is. Here's what Zipcar now says:

"Beginning November 1, 2007, for Zipcar members 21 years of age or older, our insurance coverage consists of a combined single limit of $300,000 per accident, meaning that all third party bodily injuries, or property damage costs relating to the accident covered in the aggregate up to $300,000."

While this isn't the $1 million coverage that City Carshare offers in San Francisco it's still reasonable coverage.

The picture isn't quite so good for the 18-20 year olds driving Zipcars on various college and university campuses, as Zipcar hints at:

"For drivers under 21, we provide coverage up to state-mandated levels, which vary by the state in which the accident occurs. Zipcars are covered under a vehicle collision policy."

In most states these "state-mandated levels" means the minimal $25,000-$50,000 coverage - the same as rental car companies offer (and the coverage that Zipcar used to offer all members). Flexcar used to require 18-20 year old members to show proof of coverage on a personal auto policy but I've been unable to locate a clear description on the Zipcar web site of a similar requirement.

Something else related to insurance: Zipcar is finally doing something that Conrad Wagner and I suggested to Flexcar years ago - offer members the option of paying a small annual fee for a lower deductible.  It's been offered by Canadian carsharing companies Autoshare, Cooperative Auto Network and CommunAuto for some time.  Members age 21+ have the option to purchase a damage fee waiver for $50 per year to reduce that amount to $250 or have $0 deductible for $75/year. The waivers apply for one year from the date initiated (not necessarily the same period as their annual membership).

The full information on Zipcar's insurance and waivers for 21+ year old members can be found here.