What Happens When You Write Off a Lease Car?
Writing off a lease car is something every lease driver hopes will never happen to them. However, armed with the information in this article, the situation needn’t be as stressful as you might imagine.
What is a write-off?
A write-off refers to a car that's been damaged to the point that the cost to repair it's more that the car's worth.
What do I do if I write off my lease car?
If you have a serious accident and the car is written off then you need to contact your insurance provider. You’ll also need to give your funder a call and let them know what's happened. Your insurance company will usually contact the funder, but you should also do this so that everyone's informed in a timely manner.
What should I do at the point of the accident?
It’s always important to swap details with witnesses and any other drivers involved at the scene of the crash, including:
- Name and contact details of other people involved
- Their insurance details
- Vehicle registration number, make and model
Also make notes and photographic evidence of details of the accident. For full guidance on what to do if you're involved in a traffic accident, read our full guide.
Do I still need to pay for my lease if I write off my lease car?
The lease essentially still needs to be paid but how much of it, if any, depends on your insurance company and how much they'll cover. Therefore you need to liaise with your insurance company first. They'll determine the extent of the damage and any necessary repairs which are required to remediate the vehicle. Where the cost of arranging this becomes uneconomical, the insurance company will likely declare the vehicle as a write-off.
In the case of a write-off, the finance company and insurance company will discuss the market valuation of the vehicle and if the value the insurer offers meets the requirements of the finance company, the contract will cease with no further financial obligations from you.
If the settlement amount doesn't meet the requirements of the finance company there will be a “gap” and it is the responsibility of the customer to pay the amount that falls within the gap.
While this is ongoing you must continue to pay your regular monthly rentals.
Lease car write-off FAQs:
Can I stop paying my monthly lease payments if I write off my lease car?
No, you mustn't stop paying your monthly payments until a settlement has been reached between your insurer and funder and you have been notified that there are no more payments to be made. If in doubt, contact your leasing company for an update.