--- title: 'The Guide to Insuring Leased Cars' date: '2025-03-12' permalink: 'https://jerry.ai/car-insurance/insurance-for-leased-cars/' author: 'Megan Lee' description: 'When you lease a car, you’ll likely be required to carry full coverage insurance, which costs $160 to $200 per month on average. ' image: 'https://jerry.ai/wp-content/uploads/2024/11/Depositphotos_23005422_XL-scaled.jpg' --- # The Guide to Insuring Leased Cars ![One person hands car keys to another](/wp-content/uploads/2024/11/Depositphotos_23005422_XL-scaled.jpg)When you lease a car, your lessor will likely require you to maintain full coverage [car insurance](/car-insurance/), which includes liability insurance plus comprehensive and collision coverage. Some will further require a type of coverage called “[gap insurance](/car-insurance/gap-insurance/).” A full coverage policy costs an average of $160 to $200 a month, though it varies depending on the car you drive, your personal driving history, where you live and more. ## What kind of insurance do you need for a leased car? **FOR A LEASED CAR YOU’RE REQUIRED TO CARRY:** > ALWAYS > > State-required insurance > USUALLY > > Full-coverage insurance > SOMETIMES > > Extras such as gap insurance ### State-mandated minimum car insurance requirements In almost every state, you must carry a car insurance policy meeting that state’s specific [minimum liability requirements](/car-insurance/what-is-liability-car-insurance-and-what-does-it-cover/). Liability insurance always includes the following types of coverage: - [**Bodily injury (BI)**](/car-insurance/bodily-injury-liability/)**:**In most states, the at-fault driver’s bodily injury liability covers the victim’s medical bills, lost wages and other injury-related expenses stemming from an accident. - **Property damage (PD):**Covers the costs of repairing vehicles and property damaged by the at-fault driver. The [average cost of car insurance](/car-insurance/average-car-insurance/)for liability coverage is an average of $50 to $90 a month. However, you may find that your policy costs differ significantly depending on the coverage requirements in your state. #### Some states have additional car insurance requirements, including: - **[Personal injury protection (PIP)](/car-insurance/personal-injury-protection-insurance/):**Covers expenses related to injuries that you or your passengers sustained in an accident. - [**Uninsured motorist coverage and/or underinsured motorist coverage (UM/UIM)**](/car-insurance/uninsured-motorist-coverage/)**:** Covers your expenses after getting into an accident with an uninsured or underinsured driver. - [**Medical Payments coverage (MedPay)**](/car-insurance/what-is-medical-payments-coverage/)**:** Covers the cost of ongoing medical expenses regardless of fault, including hospitalization fees and funeral expenses for yourself and/or your passengers. Keep in mind that the [minimum car insurance required in your state](/car-insurance/is-car-insurance-required/)often isn’t enough to cover damages after an accident. ### Full coverage Do you need [full coverage](/car-insurance/full-coverage-car-insurance/)on a leased vehicle? Typically, yes. If you have a loan or lease on your vehicle, the lender will require full coverage. You may also need gap insurance, which can help you pay off your loan if your car is totaled. In addition to the minimum liability insurance required by your state, most car lease agreements will require you to purchase full coverage insurance to cover damage to the vehicle in case of an accident. A policy that includes liability insurance plus full coverage costs an average of $160 to $200 a month. Full coverage insurance for a leased car includes two types of physical damage protection: collision insurance and comprehensive insurance. - [Collision coverage](/car-insurance/collision-insurance/)pays for any damages to your vehicle that result from a collision, whether with another car or a stationary object. This also includes hit-and-runs and rollovers. - [Comprehensive coverage](/car-insurance/comprehensive-insurance/)pays for damages to your vehicle that result from something other than a collision, such as vandalism, a natural disaster or theft. This additional insurance is a good idea for most drivers, especially those with newer cars — so consider adding it to your policy even if full coverage isn’t listed in your coverage requirements. According to Jerry data here are the average monthly cost of full coverage with some of the nation’s top insurance providers. | Insurance Company | Avg Monthly Quote | |---|---| | | | | | $150 | | | $182 | | | $232 | | | $240 | | | $246 | Last Updated July 24, 2026 ### Gap insurance Is gap insurance needed for leased vehicles? The short answer is sometimes. If you total your car and owe more on the lease than it’s worth, gap insurance will help cover the difference between your loan amount and the actual cash value of your vehicle. ![](https://lh7-rt.googleusercontent.com/docsz/AD_4nXcPIEXJdZ09FL16ovX9j5gtAwHpot6J2K6DaaEnwwB3BxxWHIXdVzGsRHmLCDNAd9ejpxaqwdsC4KEXNpTMNPMhIcHflASeRNLitq_NJLvJ7u1s0FgsrpVz3uw8T3h01wI2pwqTrg?key=tegTiJ9Dssx1b5iXJfU4_x57)You can typically purchase gap insurance from either your leasing company or your auto insurance provider. Gap insurance usually costs more from a dealership than from an insurance company, so get quotes from a few of the [best car insurance](/car-insurance/best-car-insurance-companies/)companies before accepting your lessor’s offer. ## Is it more expensive to insure a leased car? Yes, leasing car insurance is more expensive on average because lenders tend to require additional types of insurance and protection for the lease term. However, the final cost of your auto insurance policy depends on a lot of factors. For instance, your lessor might require insurance with high coverage limits, making your policy more expensive — or you may qualify for lower rates based on your age, where you live or your eligibility for [car insurance discounts](/car-insurance/car-insurance-discounts/). ## How to find cheap car insurance for leased cars With so many types of coverage to buy, it may feel impossible to find [affordable auto insurance](/car-insurance/cheap-car-insurance/)for a leased vehicle. Here are a few things you can do to lower your rates. - **Raise your deductible**: The higher your [deductible](/car-insurance/car-insurance-deductible/), the cheaper your monthly car insurance rates will be. However, leasing companies may set a maximum deductible, so be mindful of these requirements. Also, be sure you would be comfortable paying your deductible quickly if you needed to. - **Look for discounts:**Most insurance providers offer discounts of one kind or another. The most common discounts include those for [good students](/car-insurance/car-insurance-student-discount/), [safe drivers](/car-insurance/safe-driver-discount/), [telematics](/car-insurance/what-is-telematics/)and [home and auto insurance bundles](/car-insurance/car-and-home-insurance/). Ask your agent if there are any discounts available to you. - **Shop around:**Before you settle on a provider, [compare quotes](/car-insurance/car-insurance-quotes/)from at least three insurance companies. ## FAQ - What’s the difference between lease car insurance and owner car insurance? When you lease a vehicle, you’re bound to the contract that you sign with the lessor, which includes rules about how much insurance you need for your car. That means leased car drivers don’t have much control over their coverage levels. When you own your vehicle, you can choose your own auto insurance coverage, provided that you comply with state insurance laws. - Does Progressive offer gap insurance? Progressive offers loan/lease payoff coverage, which is similar to gap insurance but with a key difference — Progressive’s offering has a maximum payout limit of 25% of your vehicle’s value (though the limit varies by state). - Is insurance cheaper on a lease? No. Because leasing companies typically have stricter insurance requirements, you’ll usually end up paying more for car insurance on a leased vehicle compared to a car you bought outright or financed. - Is there special insurance for leased vehicles? No, there isn’t special insurance for leased vehicles. Leasing companies often require more robust insurance coverage than traditional lenders for financed vehicles, which typically includes liability, collision, comprehensive and gap insurance. ## Methodology Statistics, rates and conclusions in this article are based on Jerry’s proprietary database of real-world car insurance quotes, not third-party models or estimates. As a [licensed insurance broker ](/insurance-licenses/)in all 50 states, Jerry has firsthand visibility into how quotes are generated and validated, and all data is aggregated and anonymized to protect privacy. With millions of quotes delivered each year (often multiple offers per driver), our datasets are large enough to avoid bias toward any one region, insurer or driver type. Unless otherwise indicated, quotes shown are from drivers with clean records in the last 12 months. Quotes involving accidents, violations or credit use the last 18 months to ensure a reliable sample. ### Editorial integrity We’re all about balanced, unbiased and helpful content at Jerry. None of our articles are sponsored by advertisers or insurance companies, so you can trust the information we provide. As a comparison platform that works with 100+ insurers, Jerry has no reason to favor one insurer over another. Our job is to help you find the best fit for your situation. Read [Jerry’s car insurance data methodology](/car-insurance-data-methodology/)to learn more about how we collect, verify and share real-world insurance data. Expert-driven. Built for you. Why you can count on Jerry’s articles Why you can count on Jerry’s articles Our goal is clear, trustworthy information. Our content is created, edited and fact checked by a team of licensed insurance agents, automotive pros and experienced journalists who know the industry inside and out. Facts are thoroughly researched, verified and kept current, and our editorial team is separate from our business partners, so our opinions & tips are unbiased. All insights drawn from Jerry’s proprietary, aggregated customer auto insurance quotes data provide unique, real-world guidance. Our experts ![meet-experts-thumbnail](/wp-content/uploads/2024/11/Megan-Lee.png)Megan Lee Megan Lee is an editor, writer, and SEO expert who specializes in insurance, personal finance, travel, and healthcare. She has been published in U.S. News & World Report, USA Today and elsewhere, and has spoken at conferences like that of NAFSA: Association of International Educators. Megan has built and directed remote content teams and editorial strategies for several websites, including NerdWallet. When she`s not crafting her next piece of content, Megan adventures around her Midwest home base where she likes to drink cortados, attend theme parties, ride her bike and cook Asian food. See more ![meet-experts-thumbnail](/wp-content/uploads/2024/11/Everett-Cook.png)Everett Cook Everett Cook is an award-winning journalist and editor with more than 10 years of experience across a variety of industries. In editing for Jerry, Everett’s mission is to help readers have a better understanding of the costs of owning or leasing a car and to better understand their vehicle in terms of insurance and repairs. Prior to joining Jerry, Everett was an editor for Axios. His previous work has been featured in The New York Times, The Los Angeles Times, The San Francisco Chronicle, The Atlantic, Atlantic Re:think, The Boston Globe, USA Today, and others. 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