Car accidents are common in Colorado, with thousands reported each year. It is no surprise that many of these accidents involve vehicles that are not owned or fully paid off by the driver. If you get into a car accident in a leased vehicle, this can complicate the insurance process. Learn how to navigate the unique elements of this type of case and protect yourself financially.
If you get into a car accident in a leased car in Colorado, stay calm and remain at the scene. Call 911 and request emergency medical care if anyone is injured. Exchange information with the other driver and anyone else involved, including eyewitnesses. Take photographs of the property damage to your leased vehicle and the crash scene before you leave.
After you receive medical care, begin the claims process. Start by notifying the leasing company and your car insurance provider about the accident. The leasing company can give you directions for how to move forward, such as if it has a contract with a specific auto shop for repairs. The leasing company can also explain what will happen to your lease because of the accident. Depending on the severity of the damage, it may terminate your lease.
You are generally required to report a car accident to a leasing company. Your lease contract will most likely involve mandatory crash reporting, as well as a short deadline for notifying the company of an accident (typically 24 to 48 hours). If you fail to notify the leasing company about your crash, you could face severe penalties and ramifications.
The party responsible for paying for damage to a leased vehicle after an accident in Colorado depends on the circumstances. First, investigators will determine who is at fault. If another driver caused your crash, such as through distracted driving, his or her auto insurance company will have to pay for your property repairs. You will have the right to file a claim for compensation in the same manner that you would if you owned the vehicle. This should not increase your insurance premiums or alter your vehicle lease.
If you are found to be responsible for a car accident in a leased vehicle, you will have to pay for repairs. Most leasing companies require the purchase of collision and comprehensive insurance to cover these costs in the event of an accident. If the vehicle is totaled in the crash, meaning it cannot be repaired, you will still owe the leasing company the full value of the vehicle. Your auto insurance policy should pay out the current value.
The insurance benefits you receive will pay the outstanding balance of your lease, allowing you to break even and terminate the lease. If there is a difference between the vehicle’s current value and its value when you created the lease agreement, gap insurance can make it up. Gap insurance can help you pay for the difference between how much you owe on the lease and the depreciated value of the vehicle once you drove it off the lot.
Your car accident should not affect your car lease in Colorado. You will still owe the leasing company for the full value of the vehicle after a crash occurs. You may have to use multiple types of insurance to pay for repairs on the leased car, then continue paying the remainder of your lease agreement. If the car is totaled, your leasing agreement will typically be terminated once you’ve paid off the value of the vehicle. If you’ve been involved in a car accident in a leased vehicle in Colorado, contact an experienced car accident lawyer for more assistance with the recovery process.
The Fang Law Firm offers 100% remote and contactless meetings & representation.