AB 2361

AB2361:v97#DOCUMENT

Bill Start

CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill

No. 2361

An act to amend Section 11580.24 of the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL'S DIGEST

AB 2361, as amended, Pacheco. Insurance: personal vehicle sharing.

Existing law generally regulates classes of insurance, including automobile liability insurance. Existing law prohibits classifying a private passenger motor vehicle as a commercial vehicle, for-hire vehicle, permissive use vehicle, or livery solely because its owner allows it to be shared, if specified criteria are met. In the event of a loss or injury that occurs during any time period when the vehicle is under the operation and control of a person other than the vehicle owner, existing law requires the personal vehicle sharing program to assume all liability of the owner and is considered the owner of the vehicle for all purposes.

Existing law requires a personal vehicle sharing program to provide insurance coverages for the vehicle and operator at a minimum of $45,000 for bodily injury or death for one person, $90,000 for bodily injury or death for all persons, and $15,000 for property damage, and, on and after January 1, 2031, to provide liability coverage at least 3 times the minimum insurance requirements for private passenger vehicles.

This bill would, instead of requiring a personal vehicle sharing program to assume all liability of the owner, require the program to assume liability of the owner for bodily injury or property damage to injured third parties resulting from personal vehicle sharing in amounts stated in the personal vehicle sharing program agreement, which shall not be less than the minimum coverage amounts described above. The bill would make these provisions inapplicable if the vehicle owner engages in specified actions, including making an intentional or fraudulent material representation to the personal vehicle sharing program before the car sharing period in which the loss occurred. and not less than $250,000 for bodily injury or death for one person, $500,000 for bodily injury or death for all persons, and $100,000 for property damage. The bill would make these provisions inapplicable if the vehicle owner acts in concert with a shared vehicle driver who fails to return the shared vehicle pursuant to the terms of the personal vehicle sharing program agreement.

Digest Key

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

Section 11580.24 of the Insurance Code is amended to read:

11580.24.

(a) A private passenger motor vehicle insured by its owner pursuant to a policy of insurance subject to Section 11580.1 or 11580.2 shall not be classified as a commercial vehicle, for-hire vehicle, permissive use vehicle, or livery solely because its owner allows it to be used for personal vehicle sharing as long as all of the following circumstances apply:

(1) The personal vehicle sharing is conducted pursuant to a personal vehicle sharing program.

(2) The annual revenue received by the vehicle’s owner that was generated by the personal vehicle sharing of the vehicle does not exceed the annual expenses of owning and operating the vehicle, including depreciation, interest, lease payments, auto loan payments, insurance, maintenance, parking, fuel, cleaning, automobile repair, and costs associated with personal vehicle sharing, including, but not limited to, the installation, operation, and maintenance of computer hardware and software, signage identifying the vehicle as a personal sharing vehicle, and any fees charged by a personal vehicle sharing program.

(3) The owner of the private passenger motor vehicle does not knowingly place the vehicle into commercial use, as defined by Section 675.5, by a personal vehicle sharing user while engaged in personal vehicle sharing.

(b) For purposes of this section the following definitions apply:

(1) “Personal vehicle sharing” means the use of private passenger motor vehicles by persons other than the vehicle’s owner, in connection with a personal vehicle sharing program.

(2) “Personal vehicle sharing program” means a legal entity qualified to do business in the State of California engaged in the business of facilitating the sharing of private passenger vehicles for noncommercial use by individuals within the state.

(3) “Private passenger motor vehicle” means a vehicle that is insured, or is subject to being insured, under a personal automobile liability insurance policy insuring a single individual or individuals residing in the same household, as the named insured, or meets the requirements of Section 16058 of the Vehicle Code, but does not include a vehicle with fewer than four wheels.

(c) A personal vehicle sharing program shall, for each vehicle that it facilitates the use of, do all of the following:

(1) Provide the registered owner of the vehicle with a Department of Motor Vehicles Form REG 5085 or other suitable proof of compliance with the insurance requirements of this section and the requirements of the California Financial Responsibility Law in Section 1656.2 of the Vehicle Code, a copy of which shall be maintained in the vehicle by the vehicle’s registered owner during any time when the vehicle is operated by any person other than the vehicle’s owner pursuant to a personal vehicle sharing program.

(2) Collect, maintain, and make available to the vehicle’s owner, the vehicle owner’s primary automobile liability insurer on file with the Department of Motor Vehicles, and to any other government agency as required by law, at the cost of the personal vehicle sharing program, verifiable electronic records that identify the date, time, initial and final locations of the vehicle, and miles driven when the vehicle is under the control of a person other than the vehicle’s owner pursuant to a personal vehicle sharing program.

(3) Not knowingly permit the vehicle to be operated for commercial use by a personal vehicle sharing user while engaged in personal vehicle sharing.

(4) Use only private passenger vehicles.

(5) Facilitate the installation, operation, and maintenance of computer hardware and software and signage, necessary for a vehicle to be used in a personal vehicle sharing program, including payment of the cost of damage or theft of that equipment and any damage caused to the vehicle by the installation, operation, and maintenance of that equipment.

(d) (1) Notwithstanding any other law or any provision in a private passenger motor vehicle owner’s automobile insurance policy, in the event of a loss or injury that occurs during any time period when the vehicle is under the operation and control of a person, other than the vehicle owner, pursuant to a personal vehicle sharing program, or otherwise under the control of a personal vehicle sharing program, the personal vehicle sharing program shall assume liability of the owner for bodily injury or property damage to injured third parties resulting from personal vehicle sharing in the amounts stated in the personal vehicle sharing program agreement, which amounts shall not be less than those limits set forth in Section 11580.241. Nothing two hundred fifty thousand dollars ($250,000) for bodily injury or death for one person, five hundred thousand dollars ($500,000) for bodily injury or death for all persons, and one hundred thousand dollars ($100,000) for property damage. The provisions of this paragraph shall not apply if a vehicle owner acts in concert with a shared vehicle driver who fails to return the shared vehicle pursuant to the terms of the personal vehicle sharing program agreement.

(2) Nothing in this section limits the liability of the personal vehicle sharing program for its acts or omissions that result in injury to any persons as a result of the use or operation of a personal vehicle sharing program.

(2)The provisions of paragraph (1) shall not apply if a vehicle owner does either of the following:

(A)Makes an intentional or fraudulent material misrepresentation or omission to the personal vehicle sharing program before the car sharing period in which the loss occurred.

(B)Acts in concert with a shared vehicle driver who fails to return the shared vehicle pursuant to the terms of the personal vehicle sharing program agreement.

(e) A personal vehicle sharing program shall continue to be liable pursuant to subdivision (d) until both of the following occur:

(1) The private passenger motor vehicle is returned to a location designated by the personal vehicle sharing program.

(2) The earliest of one of the following occurs:

(A) The expiration of the time period established for the particular use of the vehicle.

(B) The intent to terminate the personal vehicle sharing use is verifiably communicated to the personal vehicle sharing program.

(C) The vehicle’s owner takes possession and control of the vehicle.

(f) The personal vehicle sharing program shall assume liability for a claim in which a dispute exists as to who was in control of the vehicle when the loss occurred giving rise to the claim, and the vehicle’s private passenger motor vehicle insurer shall indemnify the personal vehicle sharing program to the extent of its obligation under the applicable insurance policy, if it is determined that the vehicle’s owner was in control of the vehicle at the time of the loss.

(g) If the owner of the vehicle is named as a defendant in a civil action for a loss or injury that occurs during any time period when the vehicle is under the operation and control of a person other than the vehicle’s owner pursuant to a personal vehicle sharing program, or otherwise under the control of a personal vehicle sharing program, the personal vehicle sharing program shall have the duty to defend and indemnify the vehicle’s owner, subject to the provisions of subdivisions (d) and (f).

(h) Notwithstanding any other law or any provision in a vehicle owner’s automobile liability insurance policy, while a private passenger motor vehicle is used by a person other than its owner pursuant to personal vehicle sharing facilitated through a personal vehicle sharing program, all of the following shall apply:

(1) The insurer of that vehicle on file with the Department of Motor Vehicles may exclude any and all coverage afforded pursuant to its policy.

(2) The primary and excess insurer or insurers of the owners, operators, and maintainers of the private passenger motor vehicle used in a personal vehicle sharing program shall have the right to notify an insured that it has no duty to defend or indemnify any person or organization for liability for any loss that occurs during use of the vehicle in a personal vehicle sharing program.

(i) A policy of insurance that is subject to Section 11580.1 or 11580.2 shall not be canceled, voided, terminated, rescinded, or nonrenewed solely on the basis that the private passenger motor vehicle has been made available for personal vehicle sharing pursuant to a personal vehicle sharing program that is in compliance with this section.