Car Lease Insurance Types and Coverage

A driver leasing a car has a lot of liability and should take a good look at car lease insurance. Often, they are driving something they may not be able to afford ownership of, and at the very least, they are driving more value than they have prepaid for. That means that lenders will require significant auto insurance to safeguard their assets, and the investment they have made available to a driver. Here are a few different types of insurance that drivers leasing cars may need to get.

• Basic liability - basic liability insurance keeps a car legally on the road. It will pay out for damage that a driver causes to other vehicles on the road.
  
  
• Collision insurance - collision insurance will pay for damage to the drivers and car from accidents that occur on the road. Collision insurance will not pay for a lot of "extras" that don't involve a multiple vehicle collision.
  
  
• Theft insurance - theft insurance or theft insurance riders will pay out for claims related to theft or vandalism. This is important for the cost of petty vandalism, such as broken windows, as well as costly impound fees and other consequences of a vehicle theft.
  
  
• Comprehensive insurance - comprehensive auto insurance will pay for a lot of extra incidents, such as flooding, fire damage, vandalism or other scenarios that happen off of the road.
  
  
• Gap insurance - gap insurance is another policy type that must be purchased when the value of the vehicle is less than what someone has invested in it. That's because conventional auto insurance only pays according to the blue book value. Drivers or investors can get a chart showing an investment on a vehicle measured against its blue book value over time for knowing when to purchase gap insurance.

Knowing about these basic types of insurance will help drivers make smart decisions and comply with insurance requirements for safeguarding the value of their leased vehicle.