Accidents involving leased cars can be confusing, especially since you don’t technically own the car outright.
Liability in leased car accidents depends on who caused the accident and whether GAP (Guaranteed Asset Protection) coverage applies.
If you have totaled a leased car in an accident:
- The other driver or their insurance company will be liable for any damage if the accident was their fault.
- If you were at fault for the accident and you have GAP insurance, it will cover the difference between what your insurer pays and the amount you owe on the lease.
- If you were at fault for the accident and do not have GAP insurance, you might be responsible for the difference between the amount you owe on the lease and the amount your insurance company pays.
- If you were injured in an accident which wasn’t your fault, an experienced car accident lawyer at our firm can help you recover financial compensation for medical bills, lost wages, loss of earning capacity, property damage, pain, suffering, wrongful death and more.
Call us today for a FREE consultation at (800) 718-4658 or contact us if you or a loved one was injured or killed in an accident involving a totaled leased car in California.
Why Choose Nadrich Accident Injury Lawyers for a Totaled Leased Car Accident Claim
- We have been successfully recovering compensation for leased car accident victims since 1990.
- Our team has recovered over $750,000,000 for clients.
- We offer communication you can rely on and 24/7 availability.
- Our team helps get accident victims to doctors who treat them without charging them until their cases are over.
- We won’t charge you a fee until we win your case.
- Our lawyers know all of the insurance companies’ tricks and are experts at negotiating with insurers to get you the most compensation possible.
- We will handle every aspect of your claim so you can focus on your recovery.
What It Means to Total a Leased Car
There are several things to keep in mind when a leased car is totaled:
- Vehicles are considered totaled when the repair costs exceed the vehicles’ actual cash value (ACV).
- Leasing companies legally own leased vehicles.
- Lessors, not drivers, are paid by insurance companies after crashes.
- If the amount paid by the insurance company is less than the remaining balance on the lease, the driver will owe the difference unless they have GAP insurance.
Who Pays After a Leased Car Accident in California
Numerous parties may be liable for totaled leased cars in California. These parties include:
- Lessees: Lessees are commonly held liable for damages to totaled leased cars since they’re responsible for having insurance coverage. Lessees’ insurance companies often cover the cost to replace a totaled vehicle.
- Lessors: Lessors can also be held liable for accidents that are due to mechanical issues with vehicles. This is because lessors have a responsibility to make sure that leased vehicles are safe to drive and in good condition.
- Other drivers: When other drivers cause accidents, their insurance companies are liable for damages to leased cars under California Civil Code 1714. When this occurs, the lessee’s insurer will also be involved in settlement negotiations.
- Third parties: There may be cases where third parties are responsible for accidents and any damages which result. This may include accidents caused by faulty traffic signals or road construction companies. When this happens, the lessee’s insurance company will work with the lessor’s insurer to recover compensation from any responsible third party.
What If You Weren’t at Fault?
If you weren’t at fault for the accident, then the other driver’s insurance company will be liable for any damages:
- If the accident was another driver’s fault, their insurance company will pay for any damages.
- In this situation, liability works the same way it would in a rental car accident.
- You can file a lawsuit or third-party claim for the lease balance, medical bills and other losses.
- If you’ve been injured, it’s not wise to talk to the at-fault party’s insurance company. They won’t offer you what you deserve if you don’t have a lawyer, and they’ll try to trick you into saying the wrong thing so they can pay you less or nothing at all.
- If you were hurt, it’s best to contact an experienced car accident law firm who can directly negotiate with the at-fault driver’s insurance company to recover full financial compensation for you.
Call us today for a FREE consultation at (800) 718-4658 or contact us if you or a loved one was injured or killed in a leased car accident that wasn’t your fault.
Can You Be Sued for Damaging a Leased Car?
Leasing companies generally cannot sue you if your insurance fulfills the terms of the lease.
However:
- If the accident was your fault and the damage exceeds your insurance, it possible that you will be sued.
- You could be liable for breach of contract if you violated the lease agreement, such as by driving under the influence, driving recklessly or driving without insurance.
- You may face a personal injury claim for damages if you caused an accident that injured someone.
- California is a fault-based state, which means that the driver who caused the accident pays for losses.
Leased Car Insurance Requirements in California
All California drivers, including those who lease, need to carry at least the following amounts of liability coverage:
- $30,000 for death or bodily injury to a single person in an accident
- $60,000 for total death or bodily injury to more than a single person in an accident
- $15,000 for property damage in an accident
These are the minimum amounts of auto insurance in California that drivers must carry by law.
Typical Leasing Company Requirements
Most leasing companies require comprehensive insurance coverage, collision coverage and liability insurance.
Leasing companies typically require “full coverage” and, commonly, much higher liability limits in order to protect their investments. You can expect that lease agreements require:
- Higher liability limits: Lessors commonly require limits like $300,000 per accident and $100,000 per person for bodily injury, as well as $100,000 or $50,000 for property damage.
- Collision coverage: This will pay for damage to a leased vehicle should you strike an object or another vehicle. A deductible is commonly required, and it often has a maximum cap, such as no higher than $1,000 or $500.
- Comprehensive coverage: This will cover damage to a vehicle from non-collision events like vandalism, theft, striking an animal, weather or fire. A maximum deductible will apply.
- GAP insurance: This is commonly mandatory. This covers any monetary gap between the actual cash value of the vehicle (what is paid by collision/comprehensive insurance after a total loss) and any remaining balance on your lease.
- Lessor as a loss payee: Your policy will need to have the leasing company listed as an additional loss payee and insured, which means they receive any insurance payout for claims of vehicle damage.
Always carefully review any lease contract for specific requirements before you sign an agreement.
Steps to Take After Totaling a Leased Car
There are several steps you should take after totaling a leased vehicle.
However, the process of dealing with a totaled leased car actually starts before the accident happens.
Before the Accident
- Make sure you have the right insurance: You will typically be required by your lease agreement to have comprehensive coverage and collision coverage.
- Confirm GAP insurance: You should check your lease agreement to see if you have GAP insurance, which covers any difference between the actual cash value of the car and what you still owe on the lease if it gets totaled.
During the Accident
- Prioritize safety: If you’re in a motor vehicle accident in a leased car, check for injuries and, if needed, call for medical assistance.
- Call the police: Make sure to get a police report. This helps to establish facts. It can be useful when you file an auto insurance claim. Do this even for minor accidents. It’s often required by leasing companies and insurers.
- Document the scene: Take pictures of any damage as well as the accident scene.
- Exchange information: Be sure to get information such as contact details and insurance information from all other drivers involved, as well as any witnesses.
- Be careful what you say: Don’t admit responsibility or discuss fault. Keep conversation at the accident scene to the bare minimum necessary to exchange details with witnesses and other drivers.
After the Accident
- Report the incident: Contact the dealership or leasing company and your insurance company immediately. There may be a specific timeframe for reporting in your lease agreement. Report the accident immediately to your insurance company, who can guide you through the claims process. Failing to report the accident to your leasing company or insurance company may lead to penalties, and delays can complicate insurance claims.
- Handling a total loss with GAP insurance: The leasing company will be paid the car’s value by your insurance company. GAP insurance coverage should cover any gap between the remaining lease balance and any money that auto insurance pays. You shouldn’t owe any more on the car.
- Handling a total loss without GAP insurance: You may be responsible for any difference between the remaining lease balance and the insurance payout, including the deductible and any remaining lease payments.
- Lease termination: If the vehicle is totaled, you’ll probably see the lease terminated. You might be offered an option to lease a new car. You might be responsible for fees or any remaining lease obligations.
- Document everything: Be sure to keep copies of insurance claims and the accident report.
- Legal advice: If there are disputes or significant injuries, consider a consultation with an experienced car accident lawyer.
If You Were Not at Fault
- You might be able to pursue financial compensation from the at-fault driver or the other driver’s insurance company. This can cover the cost of your vehicle as well as the deductible.
- An experienced car accident attorney can help to make sure you don’t pay any more than you should, and can help you with any injury claims.
What to Remember
- You are responsible: You’re responsible for fulfilling any lease obligations, including the value of the vehicle, regardless of your accident.
- Notify the leasing company: It’s vital to notify the leasing company. They need to know about the car’s condition and the accident.
- Understand your lease agreement: The lease agreement is a contract which outlines your obligations. Review it to make sure you understand specific consequences and requirements.
When to Contact a Car Accident Attorney
Call us today for a FREE consultation at (800) 718-4658 or contact us if you or a loved one was injured or killed in a leased car accident which wasn’t your fault.
Reasons To Hire Nadrich Accident Injury Lawyers After a Leased Car Accident
- We have been successfully handling leased car accident claims since 1990.
- Our team has recovered hundreds of millions of dollars for our clients.
- We’ll handle all of the paperwork and phone calls for you while you focus on recovering from your injuries.
- Our team can get you to doctors who won’t charge you until your case is over.
- We don’t charge clients any fee until we win their case.
- Our team prevents insurance companies from exploiting accident victims, aggressively negotiating for fair compensation.
