For a leased car, you are contractually required to carry higher insurance coverage than state minimums. The leasing company (the legal owner) will mandate you have both comprehensive and collision coverage, plus high liability limits—often 100/300/100. This protects their financial interest in the vehicle. While more expensive, it provides superior protection for you as well.
The core difference from insuring a car you own is the leasing company's stake. Since they own the car, they need to ensure their asset is fully protected against damage or loss. Your lease agreement will specify exact requirements, but they typically follow a standard pattern.
Typical Leased Car Insurance Requirements
| Coverage Type | Typical Minimum Requirement (from lessor) | Common State Minimum (for comparison) | What It Protects Against |
|---|
| Liability Bodily Injury | $100,000 per person / $300,000 per accident | e.g., $25,000/$50,000 | Injuries you cause to others in an at-fault accident. |
| Liability Property Damage | $100,000 per accident | e.g., $10,000 | Damage you cause to another person's property (e.g., their car). |
| Comprehensive | Required (often with a low deductible like $500) | Not required by law | Non-collision damage: theft, fire, vandalism, weather, animal strikes. |
| Collision | Required (often with a low deductible like $500) | Not required by law | Damage to your leased car from an accident, regardless of fault. |
| Gap Insurance | Highly Recommended / Sometimes Included | N/A | Covers the "gap" between the car's value and your lease payoff if it's totaled. |
You must also list the leasing company as an additional insured or loss payee on the policy. This means the insurance company will issue payment checks directly to them (or co-payable to you and them) in the event of a claim, ensuring the funds are used to repair their asset.
A critical, often overlooked component is Gap Insurance. If your leased car is stolen or totaled, standard insurance pays only the vehicle's actual cash value. This amount can be thousands less than the early termination payoff amount on your lease. Gap insurance covers that difference, protecting you from a major financial loss. Many lease contracts include it, but it's wise to confirm.
