A few months ago, I made what I thought was a smart decision—I rented out my personal car to a friend of a friend for a few days. He needed a vehicle for a short trip, and I figured, “Why let the car sit idle when I can make some extra cash?” Big mistake.

The Call I Dreaded 🚗💥

Three days later, I got a call that sent my heart racing—my car was in an accident. The guy who rented it was fine, but my car? Not so much. It was badly damaged, and repairs would easily cost over a lakh. “No problem,” I thought. “That’s what insurance is for.”

The Shocking Reality – Insurance Denied ❌

When I called my insurance company, I got the shock of my life. They refused to cover the damage. Why? Because I had rented out my car, which is considered "commercial use," and my policy only covered personal use. I argued, begged, and even tried to explain that it was just a one-time thing—but it didn’t matter. I had unknowingly violated my insurance terms, and now, I was on my own.

Why Renting Out Your Private Car Is a Terrible Idea

1️⃣ It’s Illegal – According to the Motor Vehicles Act, 1988, private vehicles (white number plates) cannot be used for rental purposes. If caught, the vehicle can be impounded, and you could face fines or even legal trouble.

2️⃣ Insurance Won’t Cover It – Like my case, if your car is involved in an accident while being rented out, your claim will be rejected since personal vehicle insurance doesn’t cover commercial use.

3️⃣ Huge Financial Risk – If the renter damages the car or disappears, you’ll be stuck paying for repairs or even replacing the car. Not everyone will take responsibility for damages.

4️⃣ Wear & Tear Issues – Even if nothing goes wrong, renters don’t treat your car like their own. Increased mileage, rough handling, and potential mechanical issues are almost guaranteed.

Lesson Learned – Never Again!

I ended up paying for the repairs out of pocket, which completely wiped out any "profit" I made from renting the car. Looking back, I wish I had just said no. Saving a little money isn’t worth the risk of losing a car worth lakhs.

So if you’re ever tempted to rent out your private car, take it from me—don’t do it! It’s just not worth the risk.