In Canada, you need to get your car insured, whether you are purchasing, financing, or leasing the vehicle. When you get a leased car without directly purchasing it, you would have to buy the mandatory coverages. As per the established norms across Canada, even when you do not own a car, you need to purchase automobile insurance.
You need to fulfill the basic requirements to comply with the auto insurance standards. For instance, you cannot ignore coverage to third parties, even if you ignore securing your own car.
Considering the multiplicity of insurance schemes rolled out by reputed insurers, you might find it challenging to choose the right one for your leased vehicle. In these cases, it makes sense to seek help from insurance specialists like Surex. You may reach out to the experts at Surex for a professional consultation.
Buying Vs. Leasing Cars
Various factors influence the decision to buy or lease cars in Canada. When you lease a car, you have the liberty to get a new one every few years. Besides, leasing brings you the opportunity to make monthly payments at lower rates, without having to worry about the resale price of the car. In case your cash flow remains stable every month, leasing would be a great option to go with.
On the contrary, you may decide to purchase a used or new car. In these cases, you may shell out the entire cost in a single go. Alternatively, you might use financing as a viable option, where the cost would be slightly higher. However, you need to maintain the car in a good condition if you wish to resell the vehicle after a few years. This brings you additional responsibilities to maintain the car and keep it in proper condition.
Whether you decide to purchase or lease a car in Canada, you cannot overlook getting it insured.
Basic Type Of Car Insurance Policies In Canada
You have six types of insurance coverage in Canada. Once you get to know all of them, you would be in a better position to make a decision about choosing one for your leased car.
Third-Party Liability Insurance
These policies would cover your financial expenses, in case you are responsible for the damage to others’ property during an accident, or cause injuries to others.
Accident Benefit Insurance
In case you are personally injured following an accident, you would need a financial backup for managing your medical expenses. An accident benefits coverage would provide you with a financial cushion.
Uninsured Motorist Coverage
You might be involved in an accident where another driver is at fault. In case this person does not have coverage for liability insurance, or the cover proves insufficient, your uninsured motorist coverage would come to help.
Coverage For Collision
In case you are involved in a collision with an object or another vehicle, collision coverage would help you compensate for the repair and replacement expenses. Here, you can pick from various deductibles, regardless of who is at fault.
You might have some expenses arising from incidents not related to accidents or collisions. These include falling objects, windstorms, vandalism, earthquakes, etc. With comprehensive coverage in place, you can financially secure yourself against expenses arising from these incidents.
Apart from the coverages mentioned above, you have add-ons as a part of separate insurance packages. These include roadside assistance, towing costs, rental car costs, etc. Once you consult an insurance specialist, the experts would help you choose the right add-on packages.
Rules Governing Insuring Leased Cars In Canada
All drivers need the following coverages mandatorily:
- Accident benefits
- Third-party liability
- Uninsured motorist coverage
Therefore, even if you get a car on a lease, you need to purchase these policies. Only if you are driving in Newfoundland, you have accident benefits as optional coverage.
When you finance or lease your car, the organization from which you are borrowing it would make it mandatory to get additional coverage, which might be optional if you purchase a car. This implies that you may have to fork out additional charges on insurance when you lease a car.
Is It More Expensive To Purchase Insurance For Your Leased Car?
The cost of insurance has no direct connection with it being owned or leased. However, as stated, leasing companies need optimal coverages for their vehicles before handing them over to you. Therefore, the premiums would rise higher, with comprehensive and collision coverages being included in the package.
The maximum deductible restrictions would also come into play while purchasing insurance. Deductibles refer to the amount of money that you need to shell out from your pocket before the insurer compensates the remaining amount. The monthly premiums would be lower if you have high deductible plans in place. Therefore, if the situation does not permit you to pay a higher deductible than a specific amount, the premiums would be higher while leasing the car.
How Can You Get Your Leased Car Insured?
At the time of signing the lease, you would agree to meet the requirement of insurance during the contract period. Have a look at how you can provide the proof of insurance to your lessor.
- Choose the right car model.
- Inquire about the minimum requirements for insurance.
- Decide whether to invest in any additional coverage.
- Consult an insurance specialist and choose the right policy.
- Purchase the policy and email the same to the lessor.
In case you are not sure about how to make a claim while using a leased car, reach out to one of the established insurance specialists. These professionals comprehensively guide car owners and drivers while selecting insurance policies.
This way, you would have the right amount of coverage, while mitigating expenses on unnecessary elements. Insuring a leased vehicle may cost more, considering the norms of the lessor. However, professional guidance can help you cut a significant cost.