By Vincent Stokes
Every year, there are numerous businesses that come up and become successful, while others, unfortunately, fail within the first six months. This has made a lot of people focus on securing their permanent jobs instead of starting their own business. However, due to high oil prices and high car maintenance costs, many people have ended up carpooling to work and leave their cars in their driveways or garages. Over the past few years, private car owners have ended up utilizing their parked cars by renting them out to other people. This creates a new income avenue for the car owners, which can significantly supplement their monthly income. The more they rent out their cars, the more cash they earn. However, just like any other business, private car rental ventures are also prone to various complications that may end up costing the private car owner more than what they earn from the car rental business venture.
- Strict Insurance Policies
A lot of insurance companies offer packages that only cover the owner, the vehicle and any third party damage the car might have caused. Auto insurance companies try to discourage their clients from engaging in car renting or sharing ventures. In case they discover that you participate in such ventures, they can revoke your insurance coverage, which will limit the use of your car. This may also result in permanently canceling of your policy, which may force you to seek a new insurance policy cover, which will cost you more money.
- Car Damage
As you rent out your car to renters for specific number of days, the renters have complete control over your car. This means that they can drive it to their intended destinations without caring much whether the car is suited for highways or off-road travels. If the renters do not care where they drive the car, it may end up with various mechanical issues. This is a cost all car owners try to avoid at all costs. If the car is not an off-roader and the renter ends up making off-roads trips during the renting period, it may result in damaged suspensions, rims and even, the car’s body kit. This may end up costing the owner thousands of dollars in repairs.
- High Maintenance Costs
Private car owners can rent out their expensive cars like a Porsche, Lamborghini or even a Rolls Royce. Such cars can earn the owners a decent rental amount as they are classy luxury cars. Sadly, such cars have high maintenance costs when it comes to servicing and repairing defective parts. So, in case the car breaks down or is returned with one or two defective parts, they may end up costing the owner a lot of money to fix the defective parts.
- Car Theft
When it comes to renting out your private vehicle, you can never be sure of the renter’s motives even after conducting thorough background checks and confirming DMV details. Once you rent out your car, it may end up stolen and never recover it. The insurance company may also end up declining to get you a new car as your car was stolen while you had rented it out, as this is not covered in your insurance package. This will make you experience a huge loss as you will lose your car worth thousands of dollars.
- Reservation Duties
Renting out private cars is not a simple task, and private owners have to find spare time during their busy working schedule to reserve and schedule their cars. This is important as it will avoid instances where renters end up booking the car at the same time. Therefore, it is important to ensure proper reservations are made to avoid such cases.
Renting out private vehicles is an optional revenue stream for private car owners, where they get to maximize their car’s value before better and newer models are introduced in the market. However, with the associated risks and complications that may arise from renting out your private car, it is advisable you carefully evaluate every risk before renting it out.
Author: Vincent Stokes is an outdoor enthusiast and an experienced world traveler. He also writes writes for the National Parks and works to promote pride in homegrown travel destinations. You can also connect with Vincent on G+ or twitter (@TravelingGlobal).
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