Leasing is a popular way to finance a new car because it's often less expensive than buying. While there are similarities between a new car lease and an outright purchase, there are also some important differences. One of the biggest differences is that when you lease a car, you don't own it. It's owned by a third party—usually a leasing company.
What happens when you get into an accident in a leased vehicle? What must you do at the accident scene, whom do you need to notify, and how do you get your car repaired? Here's a handy guide to some important steps you should take.
At the accident scene, take the same steps you'd take in any car accident:
Your first concern should be your own safety, and the safety of other drivers and passengers involved in the accident. If anyone is hurt, call 911 and summon medical help. Provide what first aid you can to those who need it, but don't move anyone who's injured unless they're in immediate danger.
In most states, police must respond to the accident scene if there are injuries or if property damage exceeds an amount specified by state law (typically $1,000, but less in some states). You'll want law enforcement involved so they can properly document the accident scene, interview any witnesses, and prepare a police report. Having a police report will help with several issues, especially if there's a dispute about who caused the accident.
Exchange contact and insurance information with the other drivers at the accident scene. Insurers and your leasing company will ask for this information when you report the accident (more on this below).
Gather as much information as you can at the accident scene, but don't interfere with law enforcement or other first responders, and don't put yourself or others in danger. Here are some things you can do:
After you leave the accident scene, get medical attention if you need it. As soon as you're able, you'll need to report the accident to your insurance company and others. Let's have a look at whom you should notify.
Start by notifying your auto insurance company. Your auto policy requires that you notify the company immediately in the event of a wreck. Check your policy for a phone number, email address, or online notification page, and follow the policy's reporting instructions. In addition, call or email your insurance agent to notify them of the accident and see if you need to take any other steps.
(Learn more about contacting your insurance agent after an accident.)
Most lease agreements require you to notify the car dealership or leasing company where you leased your vehicle, letting them know that you've been in an accident. Again, follow the reporting requirements in your lease contract.
Keep in mind that the leasing company owns your car. The company might have repair instructions that you (and the insurance company paying for the repairs) must follow. See "How Do I Get My Leased Vehicle Repaired?" below.
State law might require that you report the accident to your state's department of motor vehicles (DMV) or some other agency. Check the DMV website for reporting requirements. If you can't find any information there, contact your insurance agent for details.
One of the first things you'll need to figure out after an accident in a leased vehicle is how to get your car repaired. The answer will depend on a couple of factors, including:
If you believe another driver was at fault for the accident, you can bring a claim against their liability insurance. On the other hand, if you were at fault, or if you don't want to wait for the insurance companies to decide who was to blame, you can bring a claim against your own insurance.
Let's look at both kinds of claims.
A claim against another driver's insurance coverage is called a third-party claim. Pursuing a third-party claim for vehicle damage involves the same process as if you owned your car outright, without any lease.
If you think the other driver was at fault, contact their insurance company and report the accident. Most insurance companies have an online claim reporting page or a mobile claim reporting app. If not, the insurance company's website should have a toll-free claim reporting number. Be prepared to provide details of the accident, such as the date, time, and location. You'll also be asked to provide the names and contact information for the other involved drivers.
After doing an investigation, the insurance company will either accept the claim or dispute it. If the insurance company accepts the claim, it will direct you to get repair estimates and will authorize you to have your car repaired.
If the insurance company denies your claim, then you've got a couple of options. First, you can sue the other driver. But litigation is an expensive and long process. A lawsuit can last from several months to a couple of years, and you might not win.
If you don't want to wait while you fight with the other driver's insurance company, your second option is to bring a claim against your own insurance coverage.
Your lease agreement likely requires that you have several kinds of insurance coverages, including collision coverage. Collision coverage is intended for the kind of situation we're now discussing: Your car was damaged in an accident that was your fault, or you can't wait for the other driver's insurance company to admit liability and cover your loss.
If you choose to bring a claim against your collision coverage, your insurance company will set up an appointment for a repair estimate. The company might send an adjuster to your location, or it might direct you to a local field office or body shop where the estimate will be prepared. Once the estimate is done, the insurance company will instruct you on the next steps to get your car fixed.
But, as we're about to cover, you might need to coordinate your vehicle repairs with the dealership or leasing company.
(Learn more about auto insurance and car accidents.)
The leasing company or dealership might have specific requirements for your repairs. For example, some leasing companies won't let you repair a leased vehicle with after-market parts. The leasing company might insist that all repairs be made with original manufacturer parts. In addition, you might be required to have the repairs done by an authorized dealer.
If you don't follow the leasing company's repair rules, you could get hit with financial penalties at the end of your lease.
Navigating through the world of insurance claims on your own can be a time-consuming and frustrating process. If you're worried that you might be in over your head, get the help you need. An experienced car accident lawyer understands insurance policy language and insurance coverages and knows how to negotiate with an insurance company.
Here's what a car accident lawyer can do to help you with your vehicle repair claim.