a car crashed into a wall

What Happens if You Crashed a Leased Car?

March 28, 2024

It's not an ideal scenario, but accidents do happen. If you're driving a leased vehicle, the steps you take immediately following an accident can significantly impact your financial and legal responsibilities. In this comprehensive guide, we're going to talk you through the process of managing the aftermath of crashing a leased car, from dealing with insurance coverage to understanding your liabilities. For those of you who have experienced or are concerned about damaging a courtesy car, many of the principles we discuss here will be relevant as well.

Insurance Coverage for Leased Cars

First and foremost, understanding the insurance coverage on your leased car is key: typically, leased vehicles come with a comprehensive insurance policy that covers the majority of accident-related costs. However, you should be aware of any deductibles that apply and the extent of coverage, including any limitations or exclusions that could affect you in the event of a crash. It's also a good idea to familiarise yourself with the process of claiming insurance in such situations, as prompt and accurate claim submission can greatly ease the process.

Reporting the Accident to Authorities and the Leasing Company

If you're involved in an accident, your immediate steps should include ensuring the safety of everyone involved and reporting the incident to the appropriate authorities. Following this, you’ll want to notify the leasing company as soon as possible. They’ll be able to guide you through their specific procedures for handling the accident, which may include reporting the incident to their chosen insurance provider. Remember, prompt reporting can prevent any unnecessary complications later on.

Assessing Damage and Repair Process

After the initial reports, your next step is going to be assessing the damage to the vehicle. The leasing company will likely have a preferred or designated repair shop to handle such assessments, and it’s essential to follow their guidelines to ensure the repair process aligns with their standards - this helps you avoid additional charges at the end of your lease term.

Liabilities and Financial Responsibilities

Depending on the severity of the accident and the terms of your lease agreement, you might also be liable for repair costs, diminished vehicle value, and any related fees. Again, it’s vital to review your lease contract and insurance policy to know exactly what your financial obligations could end up being.

Legal Implications and Considerations

Crashing a leased car can sometimes lead to legal implications, especially if you were at fault. If you were in a no fault car accident, it might be the case that the other party ends up footing the bill. Regardless of fault, seeking legal advice is your best option when it comes to protecting your interests.

Future Insurance Premiums

It’s also important to consider the long-term implications of an accident on your insurance premiums; most insurance companies will reassess your premiums following an accident, and this can end up leading to higher costs. Understanding the factors that influence these changes can help you negotiate better terms or find a more accommodating insurance provider.

Seeking Legal Advice

Ultimately, navigating the aftermath of crashing a leased car can be complex, especially when dealing with insurance claims, legal liabilities, and financial responsibilities. Seeking legal advice can provide you with the clarity and guidance necessary to manage these challenges effectively, so you’ll know how to best approach your situation to minimise negative outcomes.


What should I do if I end up totaling a leased car?

If your leased car is deemed a total loss by the insurance company, the first step is to contact the leasing company to inform them of the situation. The insurance payout will typically go directly to the leasing company since they are the actual owners of the vehicle. 

Can I lease another car after an accident?

Yes, you can lease another car after an accident. However, the process might involve a few additional steps compared to a standard lease agreement. Your insurance history, including any recent accidents, will likely influence your future insurance premiums and could also impact the leasing company's decision or terms when considering you for a new lease. 

How does a lease extension work if my car is in the shop for repairs?

In some cases, if your leased vehicle requires extensive repairs due to an accident, you might be eligible for a lease extension. This allows you to continue using the car beyond the original lease term, giving you time to make alternative arrangements or decide on your next steps. Lease extension policies vary by leasing company, so you should contact them directly to discuss your options. Typically, this involves formalising the extension in your lease agreement and adjusting your monthly payments accordingly.