As more and more people are leasing vehicles throughout Florida and the country as a whole we find it essential to share some knowledge most don’t know about accident claims and leased cars. Which can allow others, such as insurance companies, to take advantage of in case of a claim.

An accident claim when using a leased car differs from when you own the car. However, in either case, the driver and other motorists can be liable for damages and compensation. Legal proceedings help determine who is liable or deserves compensation and by how much.

What is a Leased Vehicle?

It is essentially a rental car that you rent for a specific period; it can be long-term or short-term. You can either purchase it at the end of the lease term or return it to the owner. The owners, in this case, would be the dealership.

According to the signed contract, a lease does not signify ownership of the vehicle. Like rental payments on the property, you have to pay to maintain the lease with the dealership. Otherwise, you risk repossession of the vehicle and breach of contract.

With a car lease, you can get a new, more expensive, luxurious vehicle at a lower monthly payment rate. Repair and other maintenance costs are low but are still your responsibilities.

What to do in Case of a Crash With a Leased Vehicle?

The first step in every accident scenario is to check for injuries on your person and the other passengers. The next step should be to call the police. Remain at the scene of the accident if not injured, and wait for the police to evaluate the scene and write out their report. They may also give out citations to you, or the other motorists for breaking any traffic laws.

The final and most important is to contact your insurance company for the leased car. It is advised to do so within a few days after the incident. Failure to do so reduces the likelihood of getting compensation which is crucial as it helps pay your medical bills, vehicle repairs, and more.

Legal Counsel Regarding Leased Car Repairs in an Accident Claim

Repairs depend on the level of damage to the body of the car. A car repair shop can assess the overall damage and provide you a cost estimate. In most cases, the insurance company will advise you to bring your cars to their repair shops for the estimate. If this is the case, you have to follow the lease agreement which can also specify which car repair parts to use.

If awarded a settlement, the insurance company pays for a certain percentage of the total estimate and what remains is a deductible amount which you, as the leaseholder, will be responsible for paying.

  • For example, your vehicle repair estimate is $5,000. The insurance company settles $4,000, and a $1,000 deductible amount remains. You pay for the remaining $1,000.

In most cases, insurance companies have a limited policy regarding settlement amount. The insurance company will only compensate for damages to that specific limit which does not include your deductible amount.

That is why many leaseholders apply for Gap Insurance.

 The insurance is a protective measure for leaseholders that help cater to the deductible amount and any other you may still owe the dealer after the settlement.  Gap Insurance provides dealers with an assurance that they won’t suffer damages resulting from the lease which is why you will find most Dealers insist on Gap Insurance before entering a lease contract.

  • For instance, if the total claim estimate is for $7,000, the insurance company may only be liable to pay $5,000. The leaseholder must pay the remaining amount and any deductibles. Gap Insurance pays for the deductible and the remaining $2,000.

What if the Car’s Damage is Irreversible?

If the damage after the accident is irreversible, the insurance company evaluates the vehicle. If sure of the damage level, the repair costs must be 65% of the car’s current value. Therefore, they compensate for the leased car with the current value of the car in the market.

If the lease is on-going, the leaseholder has to pay the rental amount every month for the contract period.

Need More Insight on Your Case?

Regardless of whether you own or lease a car, every vehicle incident claim requires legal representation. Our attorneys are here to help fight for you to receive the right compensation or reduce liability for your injuries and losses, minimizing the deductible amount you pay. We are here to provide you valuable intel and answer any questions you may need as insurance companies will always find ways to deny you compensation.

If in an accident in a leased vehicle, contact our car accident attorneys for a free injury claim evaluation.