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Does car leasing include insurance?

Car insurance is a must in the UK. If you’re found to be driving without the right financial protection in place, you could face six points on your licence and a fixed penalty of £300. If the case goes to court, you risk an unlimited fine and even disqualification from driving. The police also have the authority to seize and potentially destroy vehicles that are driven without insurance.

There’s certainly no disputing the importance of car insurance, but what’s the best way to go about arranging this cover? For example, if you’re planning to enter into a car leasing agreement, could you save yourself time, hassle and potentially money by including vehicle insurance in your leasing deal? Keep reading to discover more about your options.

Can I get a combined leasing and insurance agreement?

Standard car leasing agreements don’t come with vehicle insurance, however it is possible to opt for insured leases that do include this cover. If you choose this type of deal, you will pay a rental sum for your contract term that incorporates car insurance as well as vehicle leasing.

So, why might you want to consider this sort of agreement? One of the advantages associated with an insured lease is the fact that it can help you to plan your finances more easily. By insuring your car as part of your lease deal, you will pay a fixed amount for the duration of your contract (which could be anything from two to four years). This means you won’t have to worry about your premiums creeping up each year. A combined agreement will also mean you can avoid the hassle of having to search for car insurance separately, and you won’t have to think about renewal quotes at the end of every year.

Another important benefit of an insured lease is that it can streamline the repair process if your vehicle is damaged. This is because your lease provider won’t have to wait for a third party insurer to give the go-ahead for repair work to start. In turn, this can help to get you back on the road more quickly, minimising any inconvenience.

What’s included in a combined package?

The insurance provided as part of a lease package can include a range of things, including third party liability, own damage protection, glass damage protection, guaranteed maintenance and breakdown assistance. It can also include Gap insurance, which covers the difference between the amount your car was worth brand new and the amount an insurer would give you if it was stolen or written off.

What are my other options?

It’s important to be aware that advertised lease deals don’t include insurance. This is something that needs to be added and quoted for. If yours doesn’t, you’ll need to make sure that you arrange appropriate cover yourself. Policies differ widely in terms of what they cover you for, so it’s important to understand your options.

Third party insurance gives the least amount of cover, only paying out for damage caused to other parties involved in an accident in which you are to blame. These policies can be popular among young drivers and those with old cars, however they are not available to lease car drivers. The next step up is third party fire and theft policies. They offer a little more financial protection. In addition to covering any damage you cause to other parties, this type of cover pays out if your vehicle is stolen or suffers fire damage. As with basic third party protection though, this may not be available to you if you’re leasing a car.

Comprehensive insurance offers all of these features and it will cover you for any damage caused to your vehicle. One of the key points about these policies is the fact that they cover you for driving vehicles that you don’t own. For this reason, your funder will require that you have comprehensive insurance in place. Comprehensive insurance also has a number of other important benefits. For example, these policies can be tailored with a wide range of extras to give you greater flexibility.

Because there are many different policies and add-ons available, it’s important to always read the small print to make sure that the product you decide on meets your needs. You might opt to go for a car leasing agreement that includes insurance, or you may prefer to select your financial protection yourself. If you’d like further information on this important topic, check out our car leasing and insurance guide.

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All primary prices shown on this page ex VAT at the prevailing rate unless otherwise stated.

An excess mileage charge may be applied if the contracted mileage is exceeded. Full details will be provided within the written quotation.

You will not own the vehicle and it should be returned clean in a condition that is commensurate with its age and mileage, otherwise charges may apply.

LeaseCar UK is a trading style of Central Contracts (S.O.T.) Limited
Central Contracts (S.O.T.) Limited is a credit broker not a lender
Central Contracts (S.O.T.) Limited is authorised and regulated by the Financial Conduct Authority
We are acting as a credit broker for the purposes of arranging your selected finance contract. We have a commercial relationship with a carefully selected panel of lenders and we may receive a commission from the selected lender. We do not charge you a fee for our credit broking services.

Central Contracts (S.O.T.) Limited.
Central House, Trentham Business Quarter, Bellringer Road,
Stoke-on-Trent, Staffordshire, ST4 8GB.

VAT Reg No. 715 25 1558 Company Reg. No. 3635778
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From April 2020 WLTP will replace the current NEDC test procedure for establishing the official Fuel Consumption and CO2 emissions of new cars. Please be aware of the following:
For vehicles registered on or after 1st April 2020 vehicle road tax costs will be based on the WLTP CO2 values and may change the monthly rental cost.
Vehicles registered on or after 6 April 2020 Please be aware the addition of certain factory fitted options may impact the vehicles co2 emissions and affect your monthly rental.

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