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It’s a legal requirement that you have car insurance for your leased car before you drive your car away from the dealership or leasing office. But before you take out a new policy, it’s worth checking if you can transfer any insurance from a previous lease car.
Very few lease agreements offer car insurance as standard so, in most cases, you’ll need to arrange car insurance yourself. Even if car insurance is included, it’s worth doing your research to make sure you’re getting the cover you need, at the right price. Your car dealer may offer insurance as an added extra but, again, you could find a better deal by comparing quotes, rather than sticking with what the leasing company offers. Some insurance policies might offer breakdown cover as part of your package. But it’s worth checking whether your lease agreement already covers you for this
You’ll need comprehensive car insurance for your lease car. This could cover you if you damage someone else’s car, as well as your own. It will also cover the cost of the car if it’s written off or stolen.
For personal contract hire (PCH) agreements, the person taking out the agreement must be the main policyholder – or a named driver on the insurance certificate.
For business contract hire (BCH) agreements, the insurance certificate needs to be in the company or company director's name.
Taking out lease car insurance is the same as any other insurance product. But you’ll need to make it clear to your insurance provider that it’s for a lease vehicle, and let them know the terms of the lease. You’ll also have to provide the name of the vehicle’s ‘registered owner’, which will be the finance company, and the name of anybody else who’ll be driving the car – a partner or spouse, for example.
It shouldn’t be more expensive to insure a lease car than a car you’ve bought outright. However, because your lease car needs to be comprehensively insured, you won’t be able to potentially cut costs by taking out third-party insurance. Read our guide, to find out more about the differences between buying and leasing a car.
There are a few ways you can try to keep your lease car insurance costs down, namely: Do your research. Cars fall into different car insurance groups, one to 50. The higher the group, the more expensive the insurance is tends to be. Shop around. Comparing car insurance quotes three weeks before the policy start date could save you money. It’s typically the cheapest time to buy car insurance.Add an additional driver. This can, in some cases, help to lower your premiums. If the additional driver is more experienced, your insurance provider might consider the overall risk to be lower. Consider telematics insurance. If you’re a safe driver, you could be rewarded with lower annual insurance premiums. So why not compare insurance quotes with Compare the Market and see if you could find a great deal on your lease car insurance? We can help you find quotes from a range of UK car insurance providers, with our simple comparison service.