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Accident in a Leased Vehicle

Leased Car Accident

Getting in a car accident is very traumatic, no matter the situation. But in a leased car, the scenario can be even more troublesome. Like leasing an apartment, leasing a car gives you certain rights: You have the right to possess and use the car just as if you own it during the lease term. However, the leasing company still owns "your" car. That can bring up a number of legal considerations and obligations if you get in an accident.

If you have an accident in your leased vehicle

Your lease agreement will specify your exact obligations to the leasing company if you have an accident. You will almost certainly need to:

  • Document the damage

    The car will be inspected for damage by a service center (sometimes with an accompanying inspector) the leasing company chooses. This ensures the leasing company gets an accurate assessment and estimate for repair of the damage to the vehicle. This is also necessary in the event any insurance claims are filed.

  • Have adequate car insurance


    State-required minimum insurance

    All states require drivers carry minimum insurance coverage; such as liability and uninsured motorist coverage, (learn more about the coverage you should carry with our car insurance video series) specified by each state.

    Additional coverage as required by your leasing company

    However, your lease may also specify you must carry additional insurance to cover vehicle damage, including comprehensive and collision insurance.

    Should you get gap insurance?

    If the vehicle is totaled in the accident, it won't be repaired. Instead, the responsible party's insurance company will only pay an amount equal to the vehicle's actual cash value (ACV), which is its current market value.

    Unfortunately, any ACV payment will probably not cover what you still owe on the lease. A gap insurance policy will cover the "gap" between the ACV payment and what you still owe, so you won’t need to come up with the extra yourself.

    Even if your lease does not require you to carry additional insurance, it's a good idea. Remember, you're still responsible for any damage to the vehicle – or for paying what you owe on the vehicle – if you're found at fault in the accident.

  • Getting the vehicle fixed

    Depending on the damage and the kind of insurance you have, you may get a lump sum of cash to fix the car equal to the final estimate amount. If you have a deductible, that amount will be subtracted from the total repair estimate. If you are not at fault, you should be able to recover the full estimate amount from the other driver's insurance company.

Do you know what to do if you're ever in a car accident? Download our free accident checklist, so you know what steps to take. If you have already been involved in an accident, contact the personal injury lawyers at Greenman, Goldberg, Raby and Martinez for a free consultation, or call 702-388-4476.

Steps To Take After a Car Accident Offer