Maryland just rewrote the insurance playbook for peer-to-peer car sharing – and insurers should pay close attention.
House Bill 1186, signed into law by the Governor, overhauls the state's insurance and liability framework for peer-to-peer car sharing programs, the platforms that connect vehicle owners with drivers to enable the sharing of motor vehicles for financial consideration. The bill was introduced on February 11, 2026, by Delegates Mike Rogers, Scott Phillips, Nicole Williams, and Gabriel Moreno, and assigned to the Judiciary Committee, which returned a favorable report with amendments. The bill was read a second time on March 4, 2026, and the House adopted the committee report with amendments. Following Senate passage, the Governor signed it into law. The new provisions take effect October 1, 2026.
At its core, the legislation reshuffles who is on the hook for coverage when something goes wrong during a car sharing trip – and for insurers writing auto liability policies in Maryland, the practical consequences are significant.
The law repeals Section 10-6A-05 of the Insurance Article, which had established a tiered system where insurance sold in connection with a peer-to-peer car sharing agreement was generally primary, except when sold to a shared vehicle driver, in which case it was not primary to the program's own coverage. That framework is now gone.
Meanwhile, the amended Section 19-520 now sets out revised baseline requirements. A peer-to-peer car sharing program must ensure that during each car sharing period, both the vehicle owner and the driver are covered under a motor vehicle liability insurance policy that provides at least the minimum amounts required under Section 17-103 of the Transportation Article. That policy must either acknowledge that the insured vehicle is being used through a peer-to-peer car sharing program, or simply not exclude such use by a shared vehicle driver. In other words, the coverage has to actually apply to what the vehicle is being used for – no ambiguity.
The law also broadens the menu of who can provide that coverage. Previously, the insurance requirement could be met by the vehicle owner, the car sharing program, or both. Now, a shared vehicle driver's own policy can satisfy the requirement too, and any combination of the three parties is acceptable. This opens the door for more flexible coverage arrangements, but it also means insurers need to be clear about what their policies do and do not cover in this space.
One provision that will catch the attention of Maryland's insurer of last resort is the carve-out for the Maryland Automobile Insurance Fund. Under the new rules, MAIF is not required to provide coverage to a shared vehicle driver for the use of a shared vehicle that is not a replacement vehicle.
The law defines a replacement vehicle as one used while the driver's own car is not in use because of a loss – as that term is defined in the driver's applicable private passenger automobile insurance policy – or because of breakdown, repair, service, or damage. For any other car sharing scenario, MAIF is off the hook.
The legislation also addresses what happens when a driver's own insurance has lapsed. In that case, the peer-to-peer car sharing program's coverage steps in as primary. The prior version of the law had allowed the program's coverage to be secondary when the shared vehicle was used as a replacement vehicle, but that distinction has been removed.
For claims that cross state lines, a new provision requires that if an incident occurs during the car sharing period in a state with higher minimum financial responsibility limits than Maryland's, the coverage must match the minimums of the state where the claim arose. This is a straightforward but important compliance detail for programs and their insurers operating across jurisdictions.
The existing law already allows authorized insurers and MAIF to exclude any and all coverage – as well as the duty to defend or indemnify – under a shared vehicle owner's personal auto policy for any loss or injury that occurs during the car sharing period. That right applies across the board: liability for bodily injury and property damage, uninsured and underinsured motorist coverage, medical payments, personal injury protection, comprehensive physical damage, and collision coverage. These exclusion rights remain intact under the amended law.
If an insurer ends up defending or paying a claim that falls within one of those exclusions, the law preserves the insurer's right to seek contribution from the peer-to-peer car sharing program's insurer, provided the claim arose during the car sharing period and was excluded under the terms of the insurer's own policy.
The law also adds a new, broader provision at subsection (F) affirming that the section does not invalidate or limit an exclusion contained in a motor vehicle liability insurance policy, including any policy in use or approved for use, that excludes coverage for motor vehicles made available for rent, sharing, or hire, or for a business use. The existing subsection (e)(3), which contained a similar validation but limited to policies in use or approved for use before October 1, 2018, remains in the law. The new provision removes that date restriction, extending the protection to exclusions in policies regardless of when they were written or approved.
Perhaps the most significant change for carriers comes from what the law takes off the books. Former subsection (f), which had prohibited insurers from denying, canceling, voiding, terminating, rescinding, or nonrenewing a vehicle owner's personal auto policy solely because the vehicle was listed on a car sharing platform, has been repealed. Insurers are no longer restricted from making underwriting decisions based on a vehicle's participation in peer-to-peer car sharing, a change that gives carriers considerably more flexibility in managing their book of business.
On the program side, a newly created Section 18.5-102.1 of the Transportation Article introduces a set of triggers that can shift primary liability onto the car sharing program itself. The provision applies to peer-to-peer car sharing transactions originating in Maryland and to third-party claims against a shared vehicle driver arising out of the security requirement under Section 18.5-102(a)(2), but does not apply to replacement vehicles. If the program fails to deliver notice of a claim, fails to cooperate with the insurer, prejudices the handling of a claim before the insurer takes over, provides supplemental coverage beyond the statutory minimum that applies to the claim, or fails to make the disclosures required under the Insurance Article, the program becomes responsible for providing the required security on a primary basis.
The law makes a few additional changes worth noting. Programs may now transfer monetary liability to the shared vehicle driver for tolls, fees, charges, or fines incurred while the vehicle was in the driver's possession during the car sharing period. Peer-to-peer car sharing programs are also now excluded from the definition of "owner" for purposes of red-light camera citations, placing them in the same category as rental and leasing companies.
The disclosure requirements that programs must include in their agreements remain largely intact, with one exception: the law removes the prior requirement to inform parties that the program's coverage may be secondary for the driver when the vehicle is used as a replacement. That disclosure is no longer necessary given the broader restructuring of coverage priority.
Both programs and vehicle owners remain exempt from vicarious liability consistent with federal law under 49 U.S.C. Section 30106, and programs are still required to cooperate in the exchange of information following a vehicular accident.
Maryland insurers, compliance teams, and peer-to-peer car sharing platforms operating in the state should begin preparing now. The new rules take effect October 1, 2026.
