While some car owners on the platform choose to rent out their vehicles when they are not using them personally, many others specifically acquire vehicles with the intent of listing them for rent. Prospective renters are required to hold a valid driver’s license, which must be verified through the app, and they must be at least 18 years old in the United States. Notably, renters are not mandated to possess personal car insurance, a departure from the requirements of traditional rental companies.
Turo experienced a substantial surge in business following the onset of the global pandemic as travelers sought out more affordable alternatives to traditional rental car services. The company reported a remarkable 213% increase in revenue in 2021 compared to the previous year. Moreover, during the first nine months of 2024, Turo saw an 8% growth in revenue, amounting to $722 million, as detailed in its securities filing.
Although Turo had initially signaled its intention to go public in 2022 under the stock ticker symbol “TURO,” the company has consistently updated its IPO prospectus with the Securities and Exchange Commission. However, the exact timing of Turo’s stock market debut on the New York Stock Exchange remains uncertain.
The risk disclosure section of Turo’s prospectus candidly acknowledges the potential liability the company may face due to the actions of hosts and guests, emphasizing the possible detrimental impacts on its reputation, operational expenses, and overall financial health. Turo also recognizes the inherent risk associated with vehicles rented through its platform being used for criminal activities.
The document explicitly states, “We and our hosts and guests may further be subject to claims of liability based on traffic or motor vehicle violations or accidents, fatalities, injuries, property damage, theft or organized crime rings, or other similar incidents that are caused during or after a reservation booked on our platform.” Even in cases where Turo might not be deemed liable, the substantial costs associated with addressing such claims could prove burdensome, potentially dissuading hosts and guests from continued use of the platform if made public.
Turo is likely obligated to provide compensation to the owners of vehicles involved in incidents. In the United States, Turo commits to reimbursing hosts for eligible repairs up to the lesser of the cash value of their vehicle or $200,000. The host’s deductible is contingent on the percentage of earnings from bookings that they opt to retain, as outlined on Turo’s official website.
Furthermore, all Turo bookings include up to $750,000 in third-party liability coverage, underwritten by insurance provider Travelers, to safeguard against bodily injury and property damage to third parties. Guests have the option to purchase additional supplemental coverage at an extra cost.
As of the time of reporting, Travelers had not responded to CNN’s request for comment regarding its plans for compensating the individuals affected by two separate incidents, which resulted in a minimum of 16 fatalities and numerous injuries.
This report was compiled with contributions from CNN’s Chris Isidore and Eric
