Your clients are sharing everything. What could possibly go wrong?

This article is part of a sponsored series by Academy Journal.

Uber launched in 2010 in San Francisco with just a few cars and in the fourth quarter of 2024 paid their drivers $20 billion. Airbnb’s website says that it was born in 2007 when two hosts welcomed three guests in their home and in 2023, hosts earned more than $57 billion. Your clients aren’t just living in their homes and driving their cars to work and back. They are “driving” the sharing economy in their cars, trucks, homes, pools, RVs, their time, and more.

In an economy where people are feeling the squeeze in every direction, sharing apps bring the promise of some extra spending money, while at the same time, getting better use out of the things that people already own and use. As the sharing market has matured, it has also evolved. What was first a question of whether or not someone was listing a bedroom online, or whether or not they were logged into a delivery app is now a question of what they can’t share.

And the worst part is that, unless their insurance agent specifically asks the question, many clients won’t think to mention it.

Monetizing everything

Think about the premise behind sharing your home, or a part of it, from the eyes of your clients, who are renting out their space. They own the house. They aren’t using that room, and they put an outside door in when their 25 year old came home from college for a couple of years. It’s just sitting there, why not make a few extra dollars on the side. Since it’s my home and I’m already paying for insurance on my home, it has to be covered. It’s not even worth mentioning because they’ve paid for homeowners insurance for the last 25 years, never had a claim, and can’t imagine having one.

Now, take that thought process into the realm of everything else that they might be sharing.

“I’m already out running errands, I might as well log into Uber Eats and see if I can make a few deliveries.”

“I get off at five. I can take a few minutes for a quick supper, and head out to the airport for a few hours and give some rides.”

“I only use my travel trailer one or two weekends a month. I can set it up in the backyard and list it online. Someone else might as well enjoy it and help me make the payments.”

The hardest thing to get clients to consider is that this isn’t just about sharing their stuff with someone else and making a buck. Their insurance company looks at it differently than that. Pull out any of your clients’ policies: HO-3, HO-4, HO-6, Personal Auto, or Recreational Vehicles. They’ll all tell you why the insurance company sees these exposures differently.

Excluded, limited, or troublesome exposures

What they’re doing matters. It’s not just that they are making a few extra bucks in their downtime, or with property that they aren’t using. They are changing the risk characteristics of their lives, which means that they are changing the risk characteristics that their insurance companies will see, which could make what they’re doing a big deal to an underwriter or claims adjuster if something goes wrong.

Think about the rooms that a homeowner isn’t using. It might be a spare room (with or without a separate entrance). It could be the pool house. It could be that they moved and rather than selling their house, they listed it online and pay their brother and his family to make sure that the property is kept between rentals. Maybe they took a shed and made it into a “tiny house” on the back of the property. Now, instead of the normal guests, who come over for a dinner party, a play date with their kids, or an overnight stay, there are guests who pay to use the property, and they treat it like a hotel.

What if your client has a car that they’re not using every day? Maybe it’s a little exotic. Not like a classic 1969 Pontiac GTO Judge, but maybe a late model Corvette. They don’t drive it very often and they learned that they could rent it on Turo to people and make a little money off of it. They figure, what’s the harm. My agent told me that anyone who drives my car with my permission is covered, so what’s the big deal if I let someone drive it and they pay me?

That same client liked renting their car so much that they listed their RV online both on Airbnb and Outdoorsy. Now people can either come stay in the fifth wheel, or they can come pick it up and move it around the country on their vacation. Surely there’s no problem because hopefully everyone has insurance and if there’s an accident while someone has their trailer, nothing will be their responsibility.

Your client recently learned that they could sign up for Poplin and go pick up other people’s laundry, they wash, dry, fold, and return it and make a little money doing something that they’re already doing. They aren’t thinking about the fact that they have other peoples’ property in their possession. They don’t even consider that something could happen and that property could be damaged when they have it.

At this point in the post, you should begin looking up policies to discover where the exclusions, limitations, and other issues might pop up. Here’s your RTFP warning. Read the FULL policy. We aren’t adding any policy wording here. Go think about your clients, what they’re doing and aren’t telling you about, and read their policies. When your risk meter recovers, come back here and check out a few tips on how to handle all of the fun.

Good conversations make better clients

Never assume that you know everything that you need to know about your clients, even if they’ve been with you for years. Life changes and those changes don’t always get communicated to everyone who might need to know, like their insurance agent.

It all starts by asking questions. Ask what apps they are using. Ask how often they are using the apps. Ask if they have any additional dwelling units on site or if they own other properties that they list anywhere online. Nice RV. Is it on Outdoorsy? Hey. I see you put in a pool recently. Are you renting that out? You don’t have to dive too deeply, but if you don’t at least start the conversation, you’ll never know what’s going on.

No matter what questions you ask, and how the conversation goes, every conversation needs to be documented in their file. In fact, knowing that you will be documenting the conversation might spur you think about what questions you need to ask, and that might make you think about checklists. Having a checklist of common questions that you ask, or a flowchart of which questions to ask after you ask each question will help you to systematically get the information that you need without having to remember it.

If I may be direct, you need to document these conversations for at least two reasons. Your clients won’t remember the conversation without paperwork, especially if something happens and their claim is denied, or their policy is rescinded because of material misrepresentation. They’ll want to know where the money is coming from to fix the problem that came up and if you don’t have good documentation, you might be calling your E&O carrier so that the both of you can start writing checks. This is where getting their signatures at the bottom of the checklist comes in handy, too.

The other reason is that you won’t remember the conversations that you had or didn’t have if they aren’t written down somewhere. You can’t quality control the conversations that your team is having with clients. You can’t verify the effectiveness of training without having good documentation standards within your agency. You lose out on a significant amount of great information if you don’t get things documented properly.

Maybe you don’t have any clients who have a sharing exposure. Maybe this isn’t at all relevant to your book of business. Or maybe you don’t know. Have the conversations. Understand the coverage gaps. Make sure that you document everything. Maybe it’ll be the best thing you’ve done for your clients and your book of business in a long time.