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 What if I lease a car? 

What if I lease a car?

If you lease a car, you still need to buy your own auto insurance policy. The auto dealer or bank that is financing the car will require you to buy collision and comprehensive coverage. You'll need to buy these coverages in addition to the others that may be mandatory in your state, such as auto liability insurance.

  • Collision covers the damage to the car from an accident with another automobile or object.
  • Comprehensive covers a loss that is caused by something other than a collision with another car or object, such as a fire or theft or collision with a deer.
The leasing company may also require "gap" insurance. This refers to the fact that if you have an accident and your leased car is damaged beyond repair or "totaled," there's likely to be a difference between the amount that you still owe the auto dealer and the check you'll get from your insurance company. That's because the insurance company's check is based on the car's actual cash value which takes into account depreciation. The difference between the two amounts is known as the "gap."

On a leased car, the cost of gap insurance is generally rolled into the lease payments. You don't actually buy a gap policy. Generally, the auto dealer buys a master policy from an insurance company to cover all the cars it leases and charges you for a "gap waiver." This means that if your leased car is totaled, you won't have to pay the dealer the gap amount. Check with the auto dealer when leasing your car.

If you have an auto loan rather than a lease, you may want to buy gap insurance to protect yourself from having to come up with the gap amount if your car is totaled before you've finished paying for it. Ask your insurance agent about gap insurance or search the Internet. Gap insurance may not be available in some states.

With Permission ? Insurance Information Institute, Inc. - ALL RIGHTS RESERVED -

Client Testimonials 

“Dan Lorimer and the JKM team have been tremendous to work with over the past 16 years. Not only did Dan help to identify the best mortgage rates available over time, but he and his team were also diligent in providing thorough information for our auto and home insurance options. “
- Alice J., Des Plaines, IL

“JKM's hands-on approach, knowledge, and attention to their customers' needs is truly best in the industry. We have been extremely happy with the services provided by JKM and know that Dan always has our best interests in mind regarding good, quality insurance coverage and home mortgage expertise.”
- Sheila C., Des Plaines, IL

"Dan at JKM services makes selecting insurance coverage simple. We use JKM at the start up non-profit my wife works for, as well as at the small business I help run. I was so satisfied with the services and care that was received, that I also changed over all personal coverages to JKM! Unlike other companies, with Dan and JKM, I never feel like I am being "sold" something, and I know my best interest is always in mind."
-Jordan B., Oak Park, IL

"Dan at JKM Services is of great value to me and to anybody I have referred to him.  Since about 1995, Dan has assisted me [with minimum hassle] with a few refinances, my will/trust, I insure my home and auto through him, as does my daughter.  And for my business, he has arranged our health insurance for us. He has also referred me to an accountant which I count on heavily during tax season.”
-Hope D., Morris, IL

“I have recently refinanced my home using JKM services. I am very pleased I had Daniel J Lorimer to get the job done. My brother had recommended Dan. Both my brother and I were very satisfied. If needed I would use their services again.”
- John R., Bridgeview, IL

“I highly recommend JKM Services, Dan has help us with Home, Auto, and now Health Insurance needs. Dan goes that extra mile to make sure he can provide you with all the information you need to know in order to make important decisions with your insurance needs.”
- Larry F., Lombard, IL

“My family has been a client of Dan Lorimer and JKM Services for over 20‐years. Dan always has our best interest first and is always extremely prompt for any wishes we may have with our insurance needs. We have all our autos, homes and umbrella insured with Dan and wouldn’t have it any other way.”
- Len T., Carol Stream, IL

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