Legislative Analysis
Phone: (517) 373-8080
PEER-TO-PEER CAR SHARING PROGRAM ACT
http://www.house.mi.gov/hfa
House Bill 5949 as introduced Analysis available at
Sponsor: Rep. Tyrone Carter http://www.legislature.mi.gov
House Bill 5950 as introduced
Sponsor: Rep. Brenda Carter
House Bill 5951 as introduced
Sponsor: Rep. Matt Bierlein
Committee: Regulatory Reform
Complete to 11-12-24
SUMMARY:
House Bill 5949 would create the Peer-to-Peer Car Sharing Program Act, which would
regulate peer-to-peer car sharing programs in Michigan, including establish minimum
insurance coverages, establish the obligations and liabilities of various parties, requiring certain
disclosures, and various other provisions.
Peer-to-peer car sharing would mean the authorized use of a vehicle by an individual
other than the vehicle’s owner through a peer-to-peer car sharing program. It would
not include either of the following:
• Car rental or rental activity by a car rental company, as that term is defined in
section 3h of the Michigan Consumer Protection Act. 1
• A transportation network company prearranged ride, as that term is defined in
the Limousine, Taxicab, and Transportation Network Company Act. 2
Peer-to-peer car sharing program would mean an individual, partnership, corporation,
association, or other legal entity that connects vehicle owners with drivers to enable
the sharing of vehicles for financial consideration. It would not include any of the
following:
• Car rental or rental activity by a car rental company.
• A transportation network company prearranged ride.
• A service provider that is solely providing hardware or software as a service to
a person that is not effectuating payment of financial consideration for the use
of a shared vehicle.
Shared vehicle would mean a vehicle that is available for sharing through a peer-to-
peer car sharing program. It would not mean or include a rental car available to be
rented by a car rental company.
1
https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-445-903H
2
https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-257-2102
House Fiscal Agency Page 1 of 7
 Insurance
The bill would require the shared vehicle owner and shared vehicle driver to be insured during
each car sharing period under an automobile insurance policy that either recognizes that the
vehicle is used for a peer-to-peer car sharing program or does not exclude the vehicle’s use in
such a program. The insurance would have to provide all of the following:
• For the shared vehicle owner:
o Residual third-party liability insurance as required under section 3101 of the
Insurance Code, 3 in the amounts required under section 3009 of code. 4
o Personal protection insurance and property protection insurance of the types
and in the amounts required by chapter 31 of the Insurance Code, 5 except that
the peer-to-peer car sharing program would not have to ensure that the shared
vehicle owner has personal protection insurance benefits if the shared vehicle
owner has elected to not maintain coverage for personal protection insurance
benefits, or if an exclusion applies to the vehicle under the Insurance Code.
• For the shared vehicle driver, residual third-party liability insurance as required by
section 3101 of the Insurance Code, in the amounts required under section 3009 of
code.
Car sharing period would mean the period of time that commences with the car sharing
delivery period (i.e., the time during which the vehicle is being delivered) or, if there
is no car sharing delivery period, that commences with the car sharing start time (i.e.,
the time when the shared vehicle driver takes control of the vehicle) and in either case
ends at the car sharing termination time.
Car sharing termination time would mean, except as otherwise provided regarding
liability, the earliest of the following:
• The time the agreed-on period of time established for the use of the shared
vehicle expires according to the terms of the car sharing program agreement if
the shared vehicle is delivered to the location agreed on in the agreement.
• The time of the return of the shared vehicle to a location that is alternatively
agreed on by the shared vehicle owner and shared vehicle driver, as
communicated through the peer-to-peer car sharing program, which
alternatively agreed-on location must be incorporated into the car sharing
program agreement.
• The time the shared vehicle owner or the shared vehicle owner’s authorized
designee takes possession and control of the shared vehicle.
If the insurance maintained by the shared vehicle owner or driver lapses or does not provide
the required coverage, the insurance maintained by the peer-to-peer car sharing program must
provide the required coverage beginning with the first dollar of a claim and provide the duty
to defend the claim except under circumstances relating to liability described below. Coverage
maintained by a peer-to-peer car sharing program could not be dependent on another
automobile insurer first denying a claim, and another automobile insurer could not be required
to first deny a claim.
3
https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-3101
4
https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-500-3009
5
https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-218-1956-31
House Fiscal Agency HBs 5949, 5940, and 5951 as introduced Page 2 of 7
 This insurance would have to be the primary insurance during every car sharing period. If,
during a car sharing period, a claim occurred in a state with higher minimum financial
responsibility limits, the coverage would have to satisfy the difference between the two limits,
up to the applicable policy limits.
All of the following would apply to the required insurance:
• It could be placed with an insurer licensed under Chapter 4 of the Insurance Code or,
if it is maintained by a peer-to-peer car sharing program, the insurance could be placed
with an eligible unauthorized insurer under chapter 19 of the code.
• It would have to satisfy the financial responsibility requirements of the Michigan
Vehicle Code.
• It could be maintained by the shared vehicle owner, shared vehicle driver, peer-to-peer
car sharing program, or any combination of these entities.
The insurer or peer-to-peer car sharing program providing the required coverage would assume
primary liability for a claim when either of the following occurs:
• A dispute exists as to who was in control of the shared vehicle at the time of the loss
and the peer-to-peer car sharing program does not have available, did not retain, or fails
to provide the information required by the bill.
• A dispute exists as to whether the shared vehicle was returned to the alternatively
agreed-on location as required under the bill.
Liability
Generally, the bill would provide that a peer-to-peer car sharing program assumes the liability
of a shared vehicle owner in the amounts required by the car sharing program agreement,
which could not be less than those required by section 3009 of the Insurance Code.
Notwithstanding the definition of car sharing termination time, this assumption of liability
would also apply to the financial responsibility requirements in chapter V of the Michigan
Vehicle Code 6 and to the requirements for insurance coverage for bodily injury to and damage
to the property of third parties in section 3009 of the Insurance Code.
Car sharing program agreement would mean the terms and conditions applicable to a
shared vehicle owner, a shared vehicle driver, and a peer-to-peer car sharing program
that govern the use of a shared vehicle through a peer-to-peer car sharing program. It
would not mean or include either of the following:
• A car rental agreement by a car rental company, or a similar agreement.
• An agreement for a transportation network company prearranged ride.
Also notwithstanding the definition of car sharing termination time, the assumption of liability
would not apply to a shared vehicle owner if the shared vehicle owner does either of the
following:
• Makes an intentional or fraudulent material misrepresentation or omission to the peer-
to-peer car sharing program before the car sharing period in which the loss occurred.
• Acts in concert with the shared vehicle driver who fails to return the shared vehicle in
accordance with the terms of the car sharing program agreement.
6
https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-300-1949-V
House Fiscal Agency HBs 5949, 5940, and 5951 as introduced Page 3 of 7
 The bill would not do any of the following:
• Limit the liability of a peer-to-peer car sharing program for any act or omission of the
program itself that results in injury or damage to a person as a result of the use of a
shared vehicle through the program.
• Limit the ability of a peer-to-peer car sharing program to, by contract, seek
indemnification from the shared vehicle owner or the shared vehicle driver for
economic loss sustained by the peer-to-peer car sharing program that results from a
breach of the terms and conditions of the car sharing program agreement.
The bill would exempt peer-to-peer car sharing programs and shared vehicle owners from
vicarious liability, consistent with federal law, under an state or local law that imposes liability
based on vehicle ownership, including the Michigan Vehicle Code.
Consumer protection provisions
The bill would require any car sharing program agreement made in Michigan to disclose all of
the following to the shared vehicle’s owner and driver:
• Any right of the peer-to-peer car sharing program to seek indemnification from the
shared vehicle owner driver for economic loss sustained by the program that results
from a breach of the terms and conditions of the car sharing program agreement.
• That an automobile insurance policy issued to the shared vehicle owner for the shared
vehicle or to the shared vehicle driver does not provide a defense or indemnification
for any claim asserted by the peer-to-peer car sharing program.
• That the peer-to-peer car sharing program’s insurance coverage on the shared vehicle
owner and driver is in effect only during each car sharing period and that, for any use
of the shared vehicle by the driver after the car sharing termination time, the shared
vehicle driver and owner may not have insurance coverage.
• The daily rate, fees, and, if applicable, any insurance or protection package costs that
are charged to the shared vehicle owner or driver.
• That the shared vehicle owner’s automobile insurance may not provide coverage for a
shared vehicle during the car sharing period and may exclude coverage and the duty to
defend and indemnify for any claim arising out of the ownership, maintenance, or use
of a shared vehicle afforded under the insurance.
• That the shared vehicle owner’s or driver’s automobile insurance policy might already
provide the coverage required by the bill, depending on the terms of the policy.
• An emergency phone number to personnel capable of fielding roadside assistance and
other customer service inquiries.
• If there are any conditions under which a shared vehicle driver must maintain a
personal automobile insurance policy with certain applicable coverage limits on a
primary basis in order to book a shared motor vehicle.
• That, in accordance with sections 3101 and 3102 of the Insurance Code, the operation
of a shared vehicle for more than 30 days in Michigan may require the shared vehicle
driver to maintain security for payment of benefits as required under Chapter 31 of the
code, and that the failure to maintain required security might be subject to penalty as
provided by law.
In addition, the bill would require a peer-to-peer car sharing program to notify a shared vehicle
owner that, if the vehicle has a lien against it, its use through the program, including without
House Fiscal Agency HBs 5949, 5940, and 5951 as introduced Page 4 of 7
 comprehensive and collision coverage, could violate the terms of the vehicle owner’s contract
with the lienholder.
Before a shared vehicle is made available through a sharing program, the program would have
to verify that the vehicle does not have any safety recalls for which repairs have not been made
and notify the shared vehicle owner of the following requirements:
• If a shared vehicle owner has received an actual notice of a safety recall on a shared
vehicle, they could not make it available as a shared vehicle through a peer-to-peer car
sharing program until the safety recall repair has been made.
• If a shared vehicle owner receives an actual notice of a safety recall on a shared vehicle
while the shared vehicle is made available through a peer-to-peer car sharing program,
they would have to remove it from availability through the program as soon as
practicable after receiving the notice and until the safety recall repair has been made.
• If a shared vehicle owner receives an actual notice of a safety recall while the shared
vehicle is being used in the possession of a shared vehicle driver, as soon as practicable
after receiving the notice, the owner would have to notify the peer-to-peer car sharing
program about the safety recall so that the vehicle owner may address it.
Further, the bill would require that any individual that enters a car sharing agreement with a
peer-to-peer car sharing program satisfy one of the following conditions:
• The individual holds a driver license issued under the Michigan Vehicle Code that
authorizes the individual to operate vehicles of the class of the shared vehicle in
Michigan.
• The individual is a nonresident of this state to whom both of the following apply:
o They have a driver license issued by the state or country of the individual’s
residence that authorizes the individual to drive vehicles of the shared vehicle’s
class in that state or country.
o They are at least the same age as that required of a resident of Michigan to
drive.
• The individual is otherwise specifically authorized by state law to drive vehicles of the
shared vehicle’s class.
Required recordkeeping
The bill would require peer-to-peer car sharing programs to keep a record of all of the
following:
• The name and address of the shared vehicle driver.
• The number and place of issuance of the driver license of the shared vehicle driver and
of each other individual, if any, who will operate the shared vehicle.
In addition, a program would have to collect, verify, and maintain, for at least three years,
records that pertain to the use of the shared vehicle, including times used, car sharing delivery
and return locations, fees paid by the shared vehicle driver, and revenues received by the shared
vehicle owner. These records would also be provided upon request to the shared vehicle
owner’s or driver’s insurer to facilitate a claim coverage investigation, negotiation, settlement,
or litigation.
House Fiscal Agency HBs 5949, 5940, and 5951 as introduced Page 5 of 7
 Other
Under the bill, a peer-to-peer car sharing program would have the sole responsibility for any
equipment, including a GPS system or other special equipment, that is put in or on the shared
vehicle to monitor or facilitate the car sharing transaction and would have to indemnify and
hold harmless the shared vehicle owner for any damage to or theft of the equipment during the
car sharing period not caused by the vehicle owner. The program would still have a right