Shelby Clark is the founder of RelayRides, a peer-to-peer car sharing marketplace. In building this particular type of startup, Clark has faced numerous questions about insurance and legal issues — after all, if someone is going to share their car with a stranger, she needs to know that there’s no problem getting her insurance to cover any repairs to her car in the long run.
Working Within Industry Constraints
The strategy RelayRides has followed is to offer its own insurance policy to cover every rental arranged through the site. Clark notes, “It was important that RelayRides worked closely with leading insurers throughout the development of our insurance policy to design a policy that does not impact the car owner’s policy and at the same time provides coverage while the car is being used by a renter through our service.”
If you’re working in a niche where there are not only legal constraints, but also rules imposed by insurers and other non-governmental organizations, working with them to meet their needs can help you get on the road, so to speak, a lot faster.
Make Your Own Impact on the Laws
There are also on-going legal concerns for how peer-to-peer car sharing actually works. Prior to RelayRides’ launch, there wasn’t much concern about legislation governing who was driving what car at a given time — there weren’t a lot of venues that orchestrated car-sharing at that point.
RelayRides has made a point of getting involved in the discussions about how legislation can support car-sharing. The company has also made a point of looking at regulations about how insurers can handle canceling policies — one of the big questions that users of car-sharing services have to think about is if sharing their car violates their insurance policy in any way and puts them at risk of cancellation. In turn, RelayRides makes a point of informing users about their own legal rights in such a scenario.
With a truly disruptive startup, a founder can find himself in a position where existing laws don’t take new technology into account. The thing to remember is that getting laws updated, provided you can make the case for the necessary changes, is a matter of getting involved in the political process. It’s very possible to do.
Image by Flickr user Mo Riza