Car Insurance Options and Tips for Leased Cars

Due to the increasing car prices and the dwindling status of the economy today, more and more people are starting to consider leasing a car instead of buying one. This is because not only are the monthly payments lesser for leased cars but they also give you the opportunity to upgrade your car in a matter of 2 to 3 years with lesser strings attached. You can just return the car to the leasing company and apply for a newer and better model.

However note that while leased cars seem convenient, there are still a few people who are turned off of it because of the insurance costs it entails. Generally insurance for owned vehicles tend to be cheaper compared to those that are leased. Why so you ask? This is because you, as the "borrower" will be asked by the leasing company to not only procure insurance that covers the value of the car but you will also have to get something that has enough coverage to release the leasing company from any liabilities once an accident occurs.

Then again, knowing that should not in any way deter you from getting leased cars. After all, even with the more expensive insurance, they still remain to be the cheaper option. Plus, if you know how to play your cards right, the insurance you will be getting may become pretty helpful in the long run.

Note that "playing your cards right" is not exactly hard when it comes to insurance for leased cars. You just have to be aware of the terms of your coverage, be wise on knowing what you should and should not get and that's it. Now if you need more guidance on that arena, then here are some information and tips for you.

First off, you have to know that most of the time, leasing companies would require you to get a "100/300/50" type of insurance. Those numbers stand for the following:

- 100 = $100,000 coverage for bodily injuries per person;

- 300 = $300,000 coverage for total personal bodily injuries and

- 50 = $50,000 coverage for property damage.

Of course those are the minimum. Some leasing companies actually suggest that you get more so that if an accident really happens you get to have lesser amounts to cover from out of your own pocket.

Apart from that, you can also get gap insurance. What is it exactly?

To explain it in simple terms, gap insurance works this way. Say you get into an accident and your car unfortunately gets totaled. If you are covered with your regular insurance, they are most likely going to cover the value of your car alone. Normally if you own your car, that would be fine but if the vehicle you are driving is leased, then that can bring a potential problem. This is because the amount that you will get from your regular insurance may not be enough to cover your debt. Then again, that should not be a problem if you have gap insurance. This is because it will cover the deficit you may actually have.

Now the question is, is the additional insurance worth it?

Yes, it definitely is. In fact, some leasing companies find it so salient that they actually require their clients to get it. This is because in a way, gap insurance does not only protect you from debt but it also protects the investment of the leasing company as well.