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Getting the most out of your leased car insurance coverage

Getting the most out of your leased car insurance coverage

Do you need insurance on a leased car? Yes. Actually most (if not all) leasing companies require it. And they specify the levels of liability, comprehensive and collision deductibles.
Read on and we’ll show you exactly what you need to know.


Do

Do read your lease agreetment

The leasing company will specify the coverage limits that are required. Typically, the coverage for liability is $100,000 per person, $300,000 per accident, and $50,000 for property damage. As an agent I strongly recommend that the Uninsured and Underinsured limits match your liability limits.(Some states allow uninsured/underinsured property damage liability, too) The limits may differ from state to state but they will almost always be higher than the state minimums.

Do add comprehensive and collision

Again the leasing agreement will specify the deductibles for each coverage. What we have seen is $500 comprehensive and $500 collision. If the zero deductible for glass coverage is available in your state, you may want to opt for it, even though it may be more expensive. This pays for windshield replacement without a deductible if it gets damaged.

Do ask your agent about vehicle replacement coverage

This coverage is exactly what it sounds like. In the event of a total loss this coverage will completely replace the vehicle. Yes, it does cost more, but if you are leasing (or buying) a very expensive car then it will be worth every penny! It’s not available with all companies. The rules on this coverage vary from company to company. If this coverage is not available then consider purchasing gap insurance.

Do add rental reimbursement coverage

Pays for a rental car if your vehicle is damaged in an accident. Coverage varies from company to company. The “normal” coverage seems to be around $30 per day for up to 30 days.

Do add medical payments coverage

This coverage pays first in the event of injury in an auto accident. It usually doesn’t add a significant amount to the overall premium. And it comes in handy if you get injured in an accident and do not have medical insurance.


Don't

Do not assume

Never assume you have the coverage recommended or required by the leasing company. Check the agreement and then check with your local insurance agent.

Do not try to “skimp” on coverage

If you can afford the lease on a late model expensive vehicle then you should be able to protect the rest of your assets properly with the right amount of insurance coverage. Check with your agent and ask for some guidance. They are there to not just sell you a policy. A good agent will make sure you have the right amount of coverage for your needs.

Do not forget to ask for credits

You may be entitled to an early quote credit, education credit (if you have a college degree), multi-car credit, homeowner’s credit and others. Ask the company you are working with what discounts might be available to bring your premium down.

Do not make your 19-year-old the principal driver of the new leased car

Nothing increases a premium like putting a young operator in an expensive new car.  If the car is for your at-home college student, you may want to look for a good used car for them.

Do not overlook your credit score

Part of your insurance premium may based on your credit score. Companies cannot base your premium completely on credit score, but it does play a large part in determining the rate you pay, or even if they want to do business with you. The better your credit score, the more competitive your insurance premium.


Summary
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Part of your insurance premium may based on your credit score. Companies cannot base your premium completely on credit score, but it does play a large part in determining the rate you pay, or even if they want to do business with you. The better your credit score, the more competitive your insurance premium.


More expert advice about Home, Auto, and Theft Insurance

Photo Credits: Dr. Joseph Valks/freedigitalphotos.net; Check Man, Cross Man and Jump Man © ioannis kounadeas - Fotolia.com

Charlie ScheinOwner & Principal Agent

Charlie has worked in the property/casualty insurance industry since 1988. He has owned his own independent agency since 2009. Star-Schein Agency offers insurance for Car, Home, Life, Health, Medicare Health, Business and Pet Health....

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