I listed my RED Komodo kit on ShareGrid to make some extra cash. The renter had a verified profile and insurance. He picked it up, shook my hand, and disappeared. Two weeks later, ShareGrid confirmed it was a theft by conversion. I filed a claim with my own insurance (The Hartford). Denied. “You voluntarily handed the equipment to him. That is ‘Voluntary Parting’ or ‘Conversion,’ which is excluded from your theft policy.”
Key Takeaways
- Voluntary Parting Exclusion: Standard theft is “taking without permission.” If you hand the gear over (even if tricked), it is “Voluntary Parting” or “Conversion.” Most standard business policies exclude this.
- ShareGrid Protection is Secondary: ShareGrid offers coverage options, but if the renter used a stolen identity or if their policy lapses, you fall back on your policy. If your policy has the conversion exclusion, you are exposed.
- “Fraudulent Renting” Endorsement: You must specifically add “Voluntary Parting” or “Conversion” coverage to your Inland Marine policy to cover rental scams.
- The Police Report Problem: Police often call this a “civil dispute” (breach of contract) rather than a crime, making it hard to generate the police report insurance requires.
The “Why” (The Trap)
The trap is “Transfer of Custody.”
Insurance covers your custody. When you rent it out, you transfer custody.
If the renter steals it, it is not “theft” in the traditional insurance sense; it is a bad business deal.
Unless your policy specifically covers “Property Leased or Rented to Others” AND includes “Conversion” coverage, you are essentially self-insuring the rental.
The Investigation (My Analysis of Rental Risks)
I checked how to safely rent out gear in the gig economy.
Athos Insurance
- The Specialist: They are ShareGrid’s partner.
- The Verdict: If you buy their annual policy, they include “Voluntary Parting” if you follow their verification steps (ID check, contract). They understand the gig economy better than legacy carriers.
Hill & Usher (Package Choice)
- The Coverage: They offer a specific endorsement for “Conversion.”
- The Requirement: You must have a written rental agreement and a copy of the renter’s ID. If you rented it based on a text message, they might deny.
Standard Business Policy
- The Result: Almost always denied. They view renting out gear as a separate, high-risk business line that they didn’t underwrite.
[IMAGE: Screenshot of a ShareGrid “Rental Request” screen next to an insurance denial letter highlighting “False Pretense Exclusion”]
Comparison Table
| Feature | Standard Gear Policy | ShareGrid Damage Waiver | Athos / Hill & Usher (With Conversion) |
| Theft by Renter | Denied (Conversion) | Covered (Subject to limits) | Covered |
| Renter Damages Gear | Denied (Non-Owned) | Covered | Covered |
| Deductible | N/A | High (15% of value) | Standard ($500) |
| Police Report | N/A | Required | Required |
Step-by-Step Action Plan
- Call Your Agent: Ask: “Does my policy cover ‘Voluntary Parting’ or ‘Conversion’ if I rent my gear out?” If no, add it.
- Use the Platform’s Insurance: Require the renter to buy the “Damage + Theft” instant insurance on ShareGrid/offer. Don’t rely on your own.
- Verify ID: Always check the ID against the person’s face. Take a photo of their ID. If they send a “runner” to pick it up, do not release the gear unless authorized in writing.
- Get a Contract: Even on platforms, have them sign a paper rental agreement acknowledging liability. It helps convince the police it’s a crime, not just a civil dispute.
FAQ
Does this apply to lending to friends?
Yes. If a friend steals it, it’s voluntary parting.
What if they return it broken?
That is property damage while in custody of others. Also excluded unless you have “Leased Property” coverage.
Is ‘Theft by Deception’ covered?
Only if your policy includes “False Pretense.” Standard theft does not cover being tricked.