When you lease a vehicle, you need to consider both state-mandated insurance requirements and the coverage your lessor requires. In most cases, leasing a car means you’ll need to purchase a full-coverage auto insurance policy. This type of policy covers liability coverage and other state minimums, along with comprehensive coverage and collision coverage.
Here are more details about these types of car insurance:
Liability Insurance Coverage
Nearly every state requires liability coverage for property damage and bodily injury. The amounts of coverage that are required vary by state, but the central idea is that liability car insurance covers expenses for the other driver and their passengers when you cause an accident.
There are two components to liability coverage:
- Bodily injury liability: This covers other people’s medical expenses when you cause an accident. State minimums of $25,000 per person and $50,000 per accident are the most common.
- Property damage liability: This covers damage to other people’s property when you’re at fault for an accident. For this type of coverage, a state minimum of $25,000 per accident is typical.
Other State Insurance Requirements
Certain states require drivers to carry uninsured/underinsured motorist coverage. This protection kicks in when you’re in an accident with someone who doesn’t have the required liability insurance or doesn’t have enough coverage to pay your expenses.
Some states require personal injury protection or medical payments coverage in addition to liability insurance. Florida doesn’t require bodily injury liability coverage, instead mandating PIP. PIP covers medical bills, funeral expenses and lost wages for the policyholder and their passengers, no matter who’s at fault for an accident. MedPay is similar but excludes lost wages.