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Leased vehicles generally have higher automobile insurance requirements than those of a financed automotive. Most lease agreements require that the lessee (person who signs the lease) obtains higher limits of liability coverage along with low physical damage (comprehensive and collision) deductibles.
Since the automotive being financed is still technically owned by the leasing company, they can be held responsible for damages caused with that automotive; therefore, high limits of liability coverage helps protect the leasing party against any legal lawsuits.
What coverage is required for leased vehicles?
Leased vehicles usually require that the lessee purchase the following:
- $100,000 per person bodily injury liability coverage which pays for other’s injuries as a result of an "at fault" automobile accident.
- $300,000 total bodily injury liability coverage if multiple injured persons. This is the limit of currency that the insurance company would pay out for other’s injuries caused by the insured.
- $50,000 property damage liability. This coverage pays for damages caused to any property including, but not limited to vehicles, a fence, a light post, etc. The limit is on a “per accident” basis.
- Physical Damage coverage covers damages caused to the leased automotive itself. Physical damage coverage is broken down into 2 sections, “Comprehensive” which covers damages to the automotive caused by anything other than an actual automobile accident and “Collision” covers damages related directly to an accident.
The high limits of liability as shown above are generally shown on a policy as 100/300/50. The digits represent the amount of coverage in thousands.
Aside from higher liability coverage requirements, leased vehicles usually require that 1 obtains a maximum comprehensive and collision deductible of $500; although, there are exceptions with few leasing outfits.
Most lease agreements show the exact insurance requirements on the reverse side under “agreement to furnish insurance”. There ya can see the exact limits of liability and deductible requirements. Keep in mind, there are benefits to purchasing this higher coverage for your vehicles. In case of an accident, ya can have the satisfaction of knowing that your coverage will be more sufficient.
Feel free to obtain a free quote on leased automotive coverage as well as any other coverage immediately on-line. Insurance-Integrity.com lets ya fill out 1 simple form and immediately make an on-line automobile insurance comparison of various company rates.
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