What You Should Know About Insurance and Leased Cars

Posted on: January 23, 2017 By: Risk Management Blogging Team
What You Should Know About Insurance and Leased Cars

There are some people that are choosing to lease their car instead of purchasing it, but how do these people go about insuring the leased car?

If you lease a car, you are still legally required to insure it with an auto insurance policy. The auto dealer or bank that is financing your car will require you to purchase auto insurance, so whether or not you will have a policy is not in question, but what kind of coverage should you get to best match your needs?

  • Comprehensive Coverage – This coverage provides financial aid to a loss that is caused by something other than a traffic collision. It covers accidents with other objects like a tree branch, deer, theft, missile, meteorite, etc.
  • Collision Coverage – This policy will cover the damage to the car from another automobile.

Your leasing company could require you to purchase “gap” insurance. Gap insurance covers the difference between the total cost of the car you still have to pay off and your insurance check. For example, let’s say you lease a 0-carbon emission Tesla Model X for you and the family. These are expensive cars and you will have to pay back that money plus interest.

Your coverage is dependent on the market value of your car, and if you crash it, there will likely be a difference that you have to pay. Gap insurance takes care of that balance so you have nothing to worry about.

Gap insurance is something that is typically included with the final cost of your contract, so you should not actually have to buy life insurance.

Protect your car during every season with a good auto insurance policy. Contact Risk Management LLC in Brookfield, Wisconsin for all of your auto insurance needs. We are here to help you get the coverage you need at the rates you deserve.

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