How does renting out your car work?
Think of it as ‘Airbnb’ for cars, with companies like Car & Away, hiyacar or Drivy all in the market of matching up people who need wheels with those who’ve got them to hire.
As a vehicle owner, setting out your pitch using one of the online rental companies is easy.
You list your vehicle details plus rental price, availability and location and wait for potential borrowers to get in touch.
Some companies offer ‘keyless’ technology so you don’t even need to be around to hand over the keys.
And when it comes to insurance, your car’s covered by the rental company insurance, (instead of your own), while it’s hired out, and the usual deal is that cars should come back in the same condition and with the same level of fuel in the tank.
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Your rental options & how much each will pay/charge
Car & Away www.carandaway.com
If you’re flying from Gatwick and happy to hire out your car, you’ll save on airport parking, get a free car wash and even make money too.
Vehicles must be under 9 years old, with under 100,000 miles on the clock along with a current MOT, tax and comprehensive insurance, even though the company insurance kicks in while it’s being hired.
Choose the ‘Rent & Earn’ option when booking airport parking.
This saves around £40 a week compared with standard parking, and on the day, you drive up and leave your car plus keys with the concierge and you’re within a two-minute walk from the terminal.
Pick up your car on your return and if it’s been borrowed, you’ll have money in your bank account too.
You can typically earn from £80 a week up to £160 a week. However, you’ll need to factor in commission at a whopping 40%.
Billed as hiring a car from locals, Drivy says the most popular cars for hire are a Volkswagen Polo and Skoda Fabian, which would typically earn you £45-£50 a day.
Payment is made direct to your bank account minus a 30% commission.
Vehicles must be under 6 years old with less than 60,000 mileage.
You can hand over the keys yourself or use Drivy’s ‘Open Rental’ system, which means borrowers can book, unlock and complete the rental from their phone without any need for you to be around.
To do this, you’ll need Drivy to fit its system into your car, but this is free and takes two hours.
However, if you use this system, you’ll need to be happy to leave a spare key inside, which is something you might want to check with your insurer first.
Cars must be under 8 years old but there’s no mileage limit.
No need to hang around and hand over your keys here either.
‘QuickStart’ technology means your spare key fob is used to create a smart box along with a ‘virtual’ key in the hiyacar app so enables borrowers can unlock your car.
Rental fees range from £18 a day for a Toyota Aygo to £127 a day for an Audi A5 and all fees incur a 30% commission charge, unless you’re hiring an electric vehicle, in which case it’s zero commission for the first three months.
You can get away with older vehicles here providing they’re under 15 years old with less than 120,000 mileage and a maximum value of £40,000.
Go online, pop your vehicle details on and when you get rental requests, just fix up a time to hand over the keys.
Or if you don’t want to hang around, you can ask for a ‘Keysafe’ to be sent out.
One of the lowest commissions here as you’ll only lose 10%.
How much you earn varies according to where you live and the car you’ve got, but as a rough guide, you can make from around £30 a day with a Vauxhall Corsa in Bournemouth or just over £100 with an Audi A5 in London.
Car insurance considerations before you sign up
Is this a hazard for your own insurer?
“If you’re thinking of renting your car through these services, you should tell your insurer”, says Direct Line’s Chloe French.
“What one insurer will be happy with, another may not be”.
And even if your vehicle comes back looking clean with fuel in the tank, you need to consider the ‘wear and tear’ on your vehicle along with any increased mileage warns Aviva’s John Franklin.
“Vehicle mileage is one of many factors affecting insurance premiums and a higher mileage can potentially impact your future insurance risk”.
Check you’re protected
All the companies listed provide their own insurance cover, through the likes of Axa, Admiral and Allianz.
This works in place of your own policy and covers the cost of any damage while your car’s hired out.
“Do check the precise level of cover and any limitations”, warns Aviva’s John Franklin, “as you may be disadvantaged in the event of an accident, if a courtesy car is not available while yours is being repaired”.
Most companies do offer a ‘courtesy car’ as standard, but with Drivy, courtesy cars are only available if owners opt for ‘Collision Damage Waiver’ which increases the borrower’s bill.
And even with companies using ‘keyless’ technology, if you’re being asked to leave a spare key in the car, your own insurer may not be happy.
Nick Ansley, head of motor at Co-op Insurance warns that “leaving keys in cars tends to be one of the main exclusions under insurance policies, in the event of the car being stolen”.
And that's about it. Head this way for more ways to make money from your car.