Yes, you can and must insure a leased car. In fact, the leasing company will require you to carry specific types and amounts of coverage as a condition of your lease agreement. You don't own the car—the leasing company does—so they have a vested interest in protecting their asset.
The most critical requirement is typically higher liability limits than your state's minimum. While your state might only require $25,000/$50,000/$25,000 (for bodily injury per person, per accident, and property damage, respectively), a leasing company will often mandate limits of $100,000/$300,000/$100,000. They may also require you to carry comprehensive and collision coverage with a low deductible, often $500 or $1,000. The most crucial add-on is Gap Insurance (Guaranteed Asset Protection). If the car is totaled, gap insurance covers the "gap" between the car's actual cash value and the amount you still owe on the lease, which can be substantial in the early years.
| Common Lease Insurance Requirement | Typical Minimum Requirement | State Minimum (Example) | Why It's Required |
|---|
| Bodily Injury Liability | $100,000/$300,000 | $25,000/$50,000 | Protects you from lawsuits if you injure others. |
| Property Damage Liability | $100,000 | $25,000 | Covers damage you cause to others' property. |
| Comprehensive & Collision | Required with $500-$1,000 deductible | Often Optional | Protects the leasing company's vehicle from physical damage. |
| Gap Insurance | Often Required or Bundled | Not Required | Covers the negative equity if the car is totaled. |
You will need to list the leasing company as an additional insured or loss payee on the policy. This means they will receive notification of your policy status and any insurance payouts in the event of a claim will be made out to both you and the leasing company. Before you lease, always get a copy of the insurance requirements from the company and shop around with different providers to find the best rate that meets all their conditions.
