Guide to Car Insurance for Leased Cars
Nearly all leasing companies require car insurance when you lease a vehicle. And you’ll likely need coverage beyond the state-minimum liability limits — like comprehensive and collision.
Excellent
Why you can trust Insurify: Comparing accurate insurance quotes should never put you at risk of spam. We earn an agent commission only if you buy a policy based on our quotes. Our editorial team follows a rigorous set of editorial standards and operates independently from our insurance partners. Learn more.
About 25% of all new vehicles in 2024 are leased, according to data from Experian’s State of the Automotive Finance Market Report. This type of arrangement, which essentially involves renting a car in exchange for making monthly payments, comes with several benefits. But leasing a car also requires you to follow specific insurance guidelines, like increasing your liability limits or having full coverage.
Comparing quotes to find the right insurance for your leased car is crucial for safeguarding your finances and the leasing company’s financial interests in the car.1 If you plan to lease, here’s what you need to know.
Best car insurance for leased vehicles
Though you may need to buy more insurance coverage with a leased vehicle, you can still save on car insurance. Here are some of the best car insurance companies for drivers who lease their cars.
USAA: Best for military families
GEICO: Best for senior discounts
State Farm: Best for telematics
The best car insurance companies for leased cars provide affordable rates for their drivers. They also offer excellent customer service, add-on options, and discounts to help further lower your premium.
Leased car insurance requirements
Leasing companies require you to carry car insurance to ensure someone will repair the car if it’s stolen or involved in an accident. The company’s requirements usually start with the state-mandated coverage. Every U.S. state except New Hampshire requires drivers to purchase a minimum amount of liability insurance, which covers damage to the other person’s vehicle and medical costs if you cause an accident.2
Beyond the state minimum, the company may require additional coverage, like collision and comprehensive insurance, along with higher liability coverage limits. Because insurance requirements and coverage limits vary by state and leasing company, you’ll need to do some research when comparing leasing options.
How much coverage you need for a leased car
Determining how much coverage you need is a matter of checking the car insurance requirements in your state. Then, research leasing companies and what type of insurance they require. You’ll be required to buy full coverage with higher liability limits, which protects you financially in the event of an incident. It also protects the leasing company’s financial interests in the car.
Some of the coverages you may need to buy include:
Gap insurance for leased cars
Gap insurance covers the difference between what you owe on an auto loan and your insurance payout in the event of a total loss. This type of policy is optional, though some leasing companies require customers to carry it.3
Cheapest leased car insurance
Leasing companies require auto insurance — typically full coverage. Prices can range widely, depending on the insurer and other factors.
For example, insuring a car through USAA costs $108 per month, on average. But you’ll need to be affiliated with the military to qualify. Liberty Mutual is more widely available, but rates average $216 per month — double what you might pay with USAA.
Here’s a closer look at some of the cheapest leased car insurance, based on Insurify data.
How to get cheaper leased car insurance
Factors like your age and gender, driving history, and your vehicle’s make and model can all influence the cost of your car insurance. But these tips can help you find the cheapest auto policies for your leased car:4
Leased car insurance FAQs
You may find this additional information helpful as you research insurance coverage options for your leased car.
Is leased car insurance the same as full coverage?
No. Leased car insurance refers to any car insurance policy you buy for your leased car. Full coverage is a policy that includes state-mandated minimum liability insurance along with extra coverages, such as collision and comprehensive.
Does leasing a car build your credit?
Yes. Leasing a car can help you build credit. The leasing company should report your lease agreement as a loan to the credit bureaus. Those agencies then add the loan information to your credit reports.
Payment history is an important part of your credit score. So, making on-time lease payments each month can help keep your credit strong.
What insurance is required for a car lease in Florida?
Florida requires drivers to carry at least $10,000 of personal injury protection (PIP) coverage and a minimum of $10,000 of property damage liability coverage. These requirements apply to all drivers who finance, lease, or own their vehicles. Drivers can also choose to buy additional insurance or raise their coverage limits.5
Do car leases include insurance?
No. Standard car leases don’t include car insurance. When you lease a car, you’ll need to research and buy insurance that meets your state’s and leasing company’s requirements.
Is leased car insurance more expensive than insurance for a car you own?
It’s possible. When you own a car outright, the law only requires you to buy the minimum coverage mandated in the state. When you finance a car, your lender usually requires you to buy full coverage. And for a leased car, you may need higher coverage limits, which increases the cost of the policy.
)
)
)
){kind=small}
){kind=small}
)
)