What if the car is totaled?

Insurance pays the agreed value to the LLC. Distributions go pro-rata to co-owners. The group can elect to roll proceeds into a replacement vehicle.

Insurance proceeds

Vehicles are insured at agreed value, set at policy inception and re-evaluated annually. If the vehicle is totaled, the carrier pays the agreed value to the LLC's account.

Distribution

Proceeds are distributed pro-rata to co-owners after deducting any outstanding LLC obligations (unpaid management fees, ongoing reserve obligations).

Replacement option

Most groups elect to roll proceeds into a replacement vehicle of similar specification rather than wind down the LLC. The replacement option requires a 75% co-owner vote and is documented in the Operating Agreement.

If the group can't reach 75% on a replacement, the LLC winds down and proceeds are distributed. Members can then buy into a different LLC if they want to remain in the platform.

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