Leasing has become a popular option amongst drivers. Instead of purchasing the vehicle, it provides an opportunity to own the car for a certain period, often for lower monthly payments. The owner has to pay the monthly lease and comply with contractual obligations for maintaining the leased vehicle.
The U.S. government allows victims to recover different kinds of damages in car and motor vehicle accidents. One thing that many owners are often concerned about is who will be held liable and what will happen if they are involved in an accident in a leased car.
Whether you will have to pay extra fines or can recover insurance proceeds, a knowledgeable attorney can assist in all aspects. Continue reading to understand the lease laws and how the whole process works.
What happens in a leased car accident?
Whether you own a leased car or a purchased one, there are a few restrictions that you should abide by. There are specific steps that everyone can follow to make the process easier.
- Call the police – reporting the accident to the police plays a critical role, and you should immediately inform them if you have been involved in an accident. Wait until they arrive at the scene of the accident. Leaving the scene of an accident could result in criminal charges and could hurt a claim to recover compensation. If someone has sustained injuries, you should seek immediate emergency medical attention. Medical attention should also be your own priority, and you should get yourself treated immediately.
- Notify the leasing company – it is as essential as it is to inform the police. You should notify the leasing company about the accident to inform them about the condition of the vehicle. You can also review the terms of your lease agreement to determine what to do in such cases. You should ideally inform them within 24 to 48 hours of the accident to avoid any issues later. Avoid making any incriminating statements or admissions of fault. You can ask the leasing company about how to have the vehicle repaired and how you should proceed.
Will the accident affect the car lease?
The accident may or may not affect the vehicle lease depending on the circumstances. You will still have to pay for and return the leased vehicle within the contractual time period, as agreed upon. Certain leasing companies have special agreements and restrictions when accidents occur. Before proceeding, you should read the contact to avoid any hassle or misinformation by the leasing company. Repairs are generally covered by an insurance policy, and most states have mandatory insurance coverage requirements.
If your vehicle can be repaired, you should start looking for a repair company to help with it, bearing in mind the contracts terms and agreements. Most leasing companies do not allow the use of aftermarket parts for repairs. Therefore, these things must be considered before you start looking for repairs of the leased vehicle.
To know what is best in such scenarios, you must connect with an experienced Personal Injury Lawyer. He can assist you with taking the right steps in such situations.
You should carry car insurance
Whether it is your car or a leased one, you should have an insurance policy. Most states have laws mandating some minimum amount of coverage. If you are found to be driving a vehicle without insurance, you could be fined and your license could be revoked.
Therefore, you must have insurance coverage for the following reasons:
- The laws required by your state
- The contract terms in the lease
Liability coverage pays for property damage and injuries to another person caused by an accident in which you are at fault. The lease may have specific requirements regarding the minimum liability coverage you must carry. It is helpful to consider that before purchasing insurance coverage. Individuals living in other no-fault states will need to carry personal injury protection or some other type of similar coverage.
Some leasing companies will not allow you to drive the car until you provide proof of insurance. You may have to prove and provide documentation that you carry the required amount of insurance coverage.
What will happen if your leased car is totaled?
Your leased car will be referred to as totaled when the cost for repairs exceeds the car’s actual value. In these situations, your insurance company will pay the current value of the vehicle. If the value of the vehicle exceeds the outstanding balance, you may even have to terminate the lease.
Generally, the owner may have to pay a little extra to the insurance company in this situation. You should check if you have gap insurance before you proceed. You can also consult with a Philadelphia Car Accident Lawyer to ensure that you do not take any wrong steps.