As of the second quarter of 2020, 26% of new vehicle sales were leased in the U.S., but what happens if you wreck your car while it’s still technically under a lease? You may be wondering how to handle insurance coverage issues and determining fault for a totaled leased car accident when compared with an owned one. The following post will discuss all that pertains specifically to leasing cars that were totaled.
If you’ve experienced this before, you might want to talk to a good accident lawyer to help you out.
What Is A Totaled Car?
A car is totaled when it has been damaged to the point that repairs cost more than 50% of the vehicle’s market value. This typically means that the car will have a significant body, interior, and mechanical damage. A totaled car may not be safe or drivable for you to drive any longer. If you are in an accident with a totaled vehicle your insurance company might require that you buy another one instead of repairing it because they do not want you driving something unsafe.
Leased Car Accident – Not My Fault
If you have been in an accident that was not your fault and the car you leased is totaled, it can be a stressful situation. You might think that this means you are out of luck and will need to pay for the entire lease on the wrecked car. That’s not necessarily true. The leasing company may offer a settlement or trade-in for another car so that they don’t lose their investment.
If you are in an accident where the other person’s fault, there is a good chance that your car will be totaled. What happens next depends on what type of lease agreement you have. If you have a traditional lease agreement, then the insurance company pays for repairs and gives you a check to buy a new car. However, if your lease has gap coverage (newer leases) or an early termination option (older leases), then the leasing company takes over responsibility for repairing your vehicle so that you can keep driving it until they get it fixed. You may also need to pay taxes on the money received from your insurance company at tax time since it was not income earned through work.
Leased Car Accident – My Fault
If you lease a car and it is totaled in an accident, there are two scenarios that could play out. If the accident was your fault, then the leasing company will likely take back the vehicle from you and force you to buy out your remaining contract.
What Happens If You Total A Leased Car?
Owning your own car is a great responsibility. If you’re not careful, it can lead to an expensive and time-consuming situation. What happens if I total my leased car? The answer depends on the type of lease you have. If your lease agreement doesn’t allow for any repairs or damages resulting from accidents, then all you’ll need to do is notify the leasing company that they need to pick up the vehicle at your expense and provide them with a valid address. It’s also important that you don’t sign anything until after speaking with someone in charge about what will happen next! When dealing with an accident, it’s always best to get legal advice from experienced car accident lawyers before making any decisions on how to move forward so that there are no surprises later down the road.