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When Insurance Agencies Almost Killed Jessica Scorpio’s Startup, She Got Her State Government To Change The Law

Source: http://www.businessinsider.com/insurance-agencies-blocked-getaround-wrote-a-law-2012-7

Getaround was a hit when it launched last summer at TechCrunch Disrupt; it went on to raise a few million in financing.

It’s a peer-to-peer car rental service; when one person isn’t using their vehicle, they can rent it to a neighbor and give them a virtual set of keys.

But insurance companies almost killed Getaround before it could take off.

“We knew insurance would be our main problem,” Scorpio tells Inc.’s Christine Lagorio. Agencies wanted to know who would cover a car renter’s accident, the owner or the insurance company. Scorpio says she received a lot of notices that read, “We regret to inform you that we will not provide insurance coverage for this operation.”

Most people would have admitted defeated, but Scorpio found an impossible-sounding solution.

She helped write a new law.

“We started to plant the seeds in Sacramento. Democrats really like it because it’s green; Republicans really like it because it’s small business,” Scorpio tells Lagorio of her law proposal.

“The California law is AB 1871. It says that when participating in a personal-vehicle-sharing program, the car owner’s insurance is never going to be affected. An owner can make up to the value of the car—say, $10,000 a year for a normal vehicle—from renting it, but the car-sharing organization has to provide the insurance during the car-share period,” she says.

Three states have adopted a similar laws and now Berkshire Hathaway has agreed to insure GetAround.

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