No, car insurance is not automatically included when you lease a vehicle. You are almost always legally required to obtain and pay for your own insurance policy that meets the specific, and often stringent, requirements set by the leasing company. The core responsibility falls on you, the lessee, to provide proof of insurance before you can even drive the leased car off the lot.
Leasing companies have a significant financial interest in the vehicle because they own it. To protect their asset, their contracts mandate that you carry much higher levels of coverage than the minimum liability required by your state. You will typically need:
- Higher Liability Limits: Often 100/300/100, meaning $100,000 per person, $300,000 per accident for bodily injury, and $100,000 for property damage.
- Comprehensive and Collision Coverage: These are non-negotiable. They pay for damage to the leased car from accidents, theft, vandalism, or weather events.
- Gap Insurance: This is critically important. If the car is totaled or stolen, standard insurance only pays the car's actual cash value, which can be thousands less than the lease payoff amount. Gap insurance covers that "gap." While some lease agreements include it, you may need to buy it separately.
Failure to maintain the required insurance can result in the leasing company purchasing a policy on your behalf (called forced-placed insurance) and billing you for it, which is typically much more expensive and offers you no personal liability protection. The table below illustrates the stark difference between typical state minimums and common lease requirements.
| Coverage Type | Typical State Minimum (Example) | Common Lease Requirement |
|---|
| Bodily Injury Liability (per person/per accident) | $25,000 / $50,000 | $100,000 / $300,000 |
| Property Damage Liability | $10,000 | $100,000 |
| Comprehensive & Collision | Optional | Mandatory, often with a low deductible |
| Gap Insurance | Not Applicable | Mandatory (often included in lease) |
Always review your lease agreement carefully and shop for insurance quotes before finalizing the lease to understand the full monthly cost, which includes both the lease payment and the premium for the required insurance.
