What Happens If You Crash a Leased Car? The Answer You've Been Waiting for

A car accident can happen at any time, which is why every person should be prepared. However, what does someone do if they have been in a leased car accident? That answer might be slightly more complicated, but this post can explain everything.


What Is Considered a Leased Car?

What Is Considered a Leased Car?


A leased vehicle is similar to renting a car. The driver is paying for a certain amount of time, and they do not have ownership over the car. Instead, the leasing company will get the car back after the leasing period ends.


This is not the same as someone who gets a loan to purchase a vehicle. When someone has a loan, they pay monthly installments towards the loan. Once this is complete, the driver will own the car.


What Options Are Available When a Lease Contract Ends?


When a leased car's contract is done, it will be given back to the dealership from which it had been leased. The person will have three options:


  1. They can walk away from the leased vehicle completely. The driver must pay for any mileage and wear and tear charges. Also, there is a turn-in fee.

  2. The driver can trade the leased car accident in for another one. Every driver does not need to give the car back to the same dealership. They can do business with the leased vehicle anywhere. Also, the person will not be charged for mileage or a turn-in fee if they complete a trade-in.

  3. Drivers can buy the car if they want. When a leased vehicle is ready to return to the dealership, the driver will have the priority to buy the car. The driver will only need to pay the residual value. If the driver does not want the leased car, the dealership may want to buy it. However, if the dealership does not buy it, then it will go back to the leasing company to be put up for auction.


What Should Every Driver Have When Dealing with a Leasing Company?


When it is time for someone to contact a leasing company to purchase a leased car, they will need to keep a few things in mind. The driver will need to ensure that the insurance company they pick will cover them if they are in an accident in a leased car. However, if being in a leased vehicle accident is what someone is worried about, then they should consider the following things about the leased car before they sign any papers:


  • An insurance company will give a driver the minimum amount of insurance coverage.

  • How much an insurance company pays someone if they are in an accident.

  • Depending on the other driver's insurance company, they may not have enough insurance to cover the damages done if there was a car accident in a leased vehicle.

  • The insurance is enough to cover the lease agreement.


Gap Insurance


Gap insurance is activated when the leased car is valued at less than the driver needs to pay. This happens when the insurance company is dealing with a totaled car after a car accident. When the gap insurance is applied, it will cover the remaining value of the vehicle and the financial obligations the owner still has to their lease agreement. Some leasing companies require the driver to have gap insurance, but it can be helpful for those who cannot make a large payment on a leased car that has been in an accident.


What Happens When There Is a Leased Car Accident?


Leased vehicle accidents are never fun, but when one does happen, the driver will need to pull over to the side of the road and stay in one spot. If someone is injured, then they should call the emergency services immediately. Also, when the police show up, the driver should ensure that they follow all the procedures asked of them and file a police report.


Does an accident affect a car lease? The driver must call the leasing company about the car accident. This is when the driver will need to assess the damages on the leased vehicle, possibly before leaving the scene of the accident. What happens to the car lease will depend on if the driver wants to fix the car, or cancel the vehicle lease, depending on the damages.


Also, the lease agreement and insurance coverage will have a lot of essential information for when this happens. People should see if car insurance will cover any damages done to the car. If the person doesn't carry insurance to get the car to a body shop, they may have to seek other options.


What Happens If a Leased Car Is Totaled?


An accident in a leased vehicle sometimes results in the car being totaled. However, this means that the driver will still need to pay the value of the car to the leasing company. Leased vehicles have different contracts when someone purchases one, whereas insurance and leasing companies make a lot of money in the fine print.


Some insurance companies will cover all of the costs to the leasing company, but this is not a guarantee. The driver will only be able to end their lease when the car's current value equals the current value of the vehicle if the lease is broken.


Sadly, it is common that most people will still need to pay the leasing company after a leased vehicle accident. However, this is where gap insurance comes in handy because it can pay the difference. Also, it is not uncommon for a leasing company to transfer the lease to another vehicle lease.


Either way, every driver should check what their policy with the insurance provider is when it comes to leased vehicles and collision coverage.


Who Is Responsible for the Damages in a Leased Car Accident?


There are three things that people need to keep in mind when it comes to responsibility:


  1. The extent of the damage

  2. Who is responsible

  3. Insurance coverage


If the other motorist is to blame for the accident, then their insurance company will need to pay up for any damage done to the car and people in the car at the time of the accident with liability insurance. The company will also be responsible to pay what the car is currently worth to the leasing company. Any other financial losses will need to be repaid to the driver directly.


However, suppose the insurance company denies liability on the other driver's behalf. In that case, the other party will need to contact a personal injury lawyer right away and seek a free consultation to help them solve this issue. Also, they can negotiate any compensation given to the injured party.


What Damages Can Be Claimed?

What Damages Can Be Claimed?


When someone is in a car accident, they can be affected in many ways. That is why Des Moines auto accident lawyers are here to help every person who has been injured. This can be done by getting the compensation that the injured party deserves. There are two different damages that a person could receive in a personal injury protection case:


Economic Damages


Economic damages are monetary damages that can be easily calculated. The lawyer will know what to add to get the right number for the injured party. This is an easier part of the claim that will happen. Some of the things that a person can receive money for are:


  1. Medical Bills: When someone has been in a car accident, they may have medical bills like doctor appointments, hospital visits, surgery, and prescriptions. All of this can be recovered and paid for by the at-fault party.

  2. Physical Damages: Vehicle repairs can be expensive, so the at-fault party may need to pay the repair shop bill after the car has been fixed. This will help with any financial pressure put on due to the accident.


Non-Economic Damages


Non-economic damages can be harder to figure out, which is why an experienced lawyer must be involved with the car. Even though a person can still receive money for the trauma that they have been through, this is where aspects that do not have a monetary value are placed. Some examples are:


  1. Pain and Suffering: Car accidents affect people mentally and emotionally. This may make the person overly stressed to the point where they don't want to leave their home. Another example would be that they are afraid to drive. This type of suffering can be compensated, but the right lawyer must be called.


Call Tom Fowler Law Today!


When a car accident happens, every victim should have a team of people behind them that want to help look after them. However, it can be challenging to find the right group because there are many different lawyers out there, but not many of them are like the team at Tom Fowler Law.


Everyone is passionate, experienced, and knowledgeable about personal injury claims, which is why clients feel at peace when they work with them. Also, every person is listened to by the team because that is what the client deserves during this traumatizing time. There is no need to worry about decisions because the Tom Fowler Law team will always speak with the client. They want to ensure that every person is in the know when it comes to their case and circumstances.


That is why people who have questions or want a free consultation should call the team at (515) 203-8434.