If a leased car you are driving is totaled in a Houston car accident, notify the police immediately by calling 911. As soon as possible, notify the leasing company and your automobile insurance company. Depending on the circumstances, you or another party could be liable for the damages that insurance does not cover.
What Is a Leased Vehicle?
Leasing a vehicle is like renting a car. You do not own the vehicle, but you keep the vehicle and drive it as if you owned it.
The leasing company owns the vehicle. You make monthly payments to the leasing company to drive the vehicle. At the end of the lease term, you return the vehicle to the leasing company or purchase the vehicle, depending on the terms of the lease agreement.
The lease agreement requires that you return the vehicle to the company in good condition. Typically, the agreement also contains clauses that hold you responsible for any damage to the vehicle during the lease term.
For that reason, many lease companies require individuals to purchase additional insurance to cover property damage. However, that might not be the case with all lease agreements.
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Leased Vehicles Must Have Minimum Car Insurance Coverage
Leased vehicles must have the minimum amount of required automobile insurance. Texas law requires all vehicles to have minimum insurance coverage of:
- $30,000 to cover injuries to one person in an accident
- $60,000 to cover injuries to two or more people in an accident
- $25,000 to cover property damage to another person’s vehicle
Liability insurance compensates victims for damages when they cause a car accident. Therefore, liability insurance would not pay to repair your leased vehicle if you caused the car crash.
Most lease agreements require you to purchase additional insurance coverage that protects the leasing company if the vehicle is damaged.
Collision coverage pays to replace or repair a vehicle after an accident that is your fault. Comprehensive coverage pays to replace or repair a vehicle if it is damaged by flood, vandalism, theft, fire, or another casualty other than a collision.
If you lease a vehicle, it is wise to carry the maximum coverage for collision and comprehensive coverage. If there is a gap between your insurance coverage and the cost to replace a totaled vehicle, you would be personally liable for the difference.
You might also want to consider gap insurance coverage. Gap insurance covers the difference between your collision coverage and the vehicle’s value. However, read the policy carefully to ensure it does not exclude leased vehicles.
Can the Leasing Company Require Me To Pay the Lease Payments for a Totaled Vehicle?
When you signed the lease agreement, you agreed to pay all lease payments due on the contract. Therefore, the leasing company will likely demand payment for the remaining lease payments. Traditional car insurance might not cover the payments, so purchasing an insurance policy that protects you if you total a leased vehicle is crucial.
You could sue the driver for damages if the other driver caused the car accident. Economic damages include expenses related to the accident, including lease payments you had to pay out of pocket. However, if the driver has minimum insurance limits, the liability insurance policy might not cover the value of the leased vehicle.
Check your underinsured motorist insurance policy to determine if it applies to a leased vehicle. Underinsured motorist coverage fills in the gap between the total of your damages and the amount of the at-fault driver’s insurance policy.
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What Should I Do After an Accident in a Leased Vehicle in Houston?
Call 911 to report the crash and wait at the accident scene for the police to arrive. Do not admit fault for the cause of the accident or decline medical care. You want to protect yourself if you need to file a personal injury claim.
If it is safe to do so, document the accident scene. This step is essential because the evidence could prove that the other driver caused the crash.
Take pictures of the accident scene and the vehicles. Also, video the entire scene with your cell phone camera. Ask witnesses for their names and contact numbers.
As soon as possible, notify the leasing company and your insurance provider. You might also want to discuss the accident with a Houston car accident lawyer.
An accident attorney can review your lease agreement and explain your rights and obligations under the contract. The lawyer can also review your insurance policies to determine the coverage amounts and how they apply. If you are injured, having a personal injury lawyer handle your case can help you recover a fair settlement for your damages.
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Contact the Houston Car Accident Lawyers at Attorney Brian White Personal Injury Lawyers For Help
For more information, contact the Houston car accident law firm of Attorney Brian White Personal Injury Lawyers at (713) 500-5000.
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About the Author Brian White
Brian White earned his J.D. from South Texas College of Law in Houston and is licensed to practice in Texas. He is a Board-Certified Personal Injury Trial Lawyer.
Dedicated to giving back, he actively supports local charities and community initiatives.
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