SB265 Alabama 2025 Session

Summary

Primary Sponsor

Chris ElliottSenator

Republican

Session

2025 Regular Session

Title

Motor vehicles; Peer-to-Peer Car Sharing Program Act, established

Summary

SB265 creates the Peer-to-Peer Car Sharing Program Act in Alabama, establishing rules for platforms that connect vehicle owners with drivers, including insurance, liability, tax, safety, and recordkeeping requirements.

What This Bill Does

It authorizes peer-to-peer car sharing programs to operate in Alabama and requires them to provide or arrange primary motor vehicle liability insurance during each car sharing period with minimum coverage. It mandates recordkeeping, safety recall verification, lien notices, and disclosures to owners and drivers, and it establishes tax rules including a 4% gross-proceeds privilege tax for leasing facilitated by such programs. It sets driver eligibility, program reporting duties, and an effective date of October 1, 2025.

Who It Affects

• Shared vehicle owners: must insure their vehicle for P2P sharing during each car sharing period, may be liable to indemnify the program for breaches in terms, must be notified about liens that could affect P2P use, and must comply with recall and tax requirements.
• Shared vehicle drivers: must be at least 18 and hold a valid license (in-state or eligible nonresidents), must be insured during the car sharing period, and are subject to program disclosures, recall verification, and recordkeeping requirements.

Key Provisions

• Creates the Peer-to-Peer Car Sharing Program Act and defines key terms (car sharing period, car sharing delivery period, shared vehicle, etc.).
• Requires primary motor vehicle liability insurance during each car sharing period with minimum coverage and recognition that the vehicle is used in a peer-to-peer program; coverage can be provided by owner, driver, program, or combinations.
• Requires the program to notify owners about lienholders and potential contract conflicts before listing a vehicle for sharing.
• Allows insurers to exclude certain coverages, but preserves certain policy terms and the overall ability to underwrite and cancel policies under existing law.
• Mandates collection, verification, and retention of usage records (uses, locations, fees, revenues) and provides access to owner/insurer for claims investigations.
• Exempts the program and owner from vicarious liability in some contexts and permits the program to seek indemnification from owners/drivers for breaches of the program agreement.
• Imposes a 4% privilege or license tax on gross proceeds from P2P leasing, with specific rules for when this tax applies and how it interacts with sales/use taxes; local rental taxes may also be collected by the program.
• Requires driver eligibility and program disclosure of rights, insurance details, and recall requirements, including the program’s responsibility for equipment in the vehicle and recall-related procedures.
• Enforces safety recall verification before listing and requires immediate action if a recall is issued during a car sharing period.
• Effective date set for October 1, 2025.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Motor Vehicles & Traffic