Compare Car Insurance for Business Leases: Rates, Discounts, & Requirements [2025]

Leasing is the easiest way for businesses to drive a new vehicle with a reduced upfront cost. Sometimes the lease payment can even be less than if the vehicle was purchased outright. However, whether leased or owned, it is mandatory for every driver to have car insurance to be able to drive on U.S. roads.

However, if you have a car lease, insurance average rates are generally higher since insurance requirements to lease a car are higher.

Business lease car insurance is available, but you need to compare quotes to make sure you are getting the best deal, just like on your personal insurance.

You don’t want to get landed with a high monthly payment, so it’s best to shop around no matter your situation. For car lease and insurance deals, enter your ZIP and compare insurance quotes today to make sure you’re not overpaying for coverage.

Car Insurance for Business Leases

Why lease a vehicle when you own a business? Business contract hire car leasing can save businesses money as leasing a car is generally cheaper than buying. You can also save money on business taxes, such as deducting the cost of your lease.

For many businesses that require fleets of vehicles, a low monthly payment is a good goal to have since costs can stack up quickly.

Getting the best business contract hire car deals can save your business upfront operating costs.

Businesses can choose to work with a company on how to lease a vehicle for business use. Leasing companies will explain how to buy car insurance for leased vehicles and may be able to provide an insurance quote for business car leases.

Happy customers are those who understand what they’re paying for, after all. Many factors will determine is it better to lease or purchase a business vehicle for each company.

How many vehicles you will need, the type of vehicle needed, and how long you want to keep the vehicle are important factors to determine when is it a good idea to lease a business vehicle. Understanding the lease terms is incredibly important. 

Read more: Why do leased vehicles have higher car insurance costs?

Understand if Contract Hire Includes Insurance

Unfortunately, the leasing price does not include insurance, whether it’s a new or used car business contract hire. Car insurance for business leases is generally higher coverage at a higher rate. Finding business car lease deals including insurance is rare.

Leasing is the most convenient way of getting more cars for less money, but it doesn’t mean you can skip insurance. In fact, a leased car may require more coverage than an owned car.

So, do you need full car insurance coverage for a lease? The answer is probably yes. The rate that you pay for car insurance is affected by the coverage type you choose.

Car Insurance for Company Vehicles: Average Monthly Rates by Coverage Level & Provider

You can see that high coverage is the most expensive, but it offers liability, collision, and comprehensive coverages. This type of insurance will be needed for leasing a vehicle. Since the car belongs to the dealer, they want to protect their investment in case your car is stolen, or you get into an accident.

Conventional insurance companies often struggle to offer appropriate policies for lease car coverage, especially if the owner and the person keeping the vehicle do not agree.

This usually happens if the two enter a personal contract hire (PCH) or personal contract purchase (PCP). Lease contracts are very real, and are to be taken very seriously.

Read more:

• Do I need car insurance to lease a car?
• Do I need full coverage car insurance to lease a car?
• Compare Car Insurance for Leased Cars: Rates, Discounts, & Requirements

Car Insurance Requirements for Leaseholders

Lease car insurance requirements are often higher since leasing companies require your leased car to have high liability insurance limits. It may seem like they’re just trying to tack on additional charges, but that’s not the case.

Your leased car belongs to the company that finances it. To protect its economic stake in the vehicle, the finance company will most likely require you to have comprehensive and collision coverage on your car policy. These coverages are:

• Collision: Regardless of whether you are at fault or not, collision coverage will help pay for your car repairs in case you get hit by another vehicle, your car hits someone else’s car, or it rolls over.
• Comprehensive: This helps pay for damages to your car caused by something other than an accident, like vandalism, theft, or a falling object.

You can see why these additional coverages would be useful in the event of an accident.

There are those who will even require you to carry a lower deductible or make you put in some backup money for the period of the lease in case your deductible is higher.

Each leasing company will have its own requirements. For example, Honda lease insurance requirements will differ from Volkswagen’s lease insurance requirements.

Some rental companies specify in their lease agreement that if repairs are to be made due to a collision or comprehensive claim, you must use original equipment manufacturer [OEM] parts only, which are generally more expensive compared to after-market parts.

Fortunately, most auto lease insurance policies have a low-cost option that caters to the difference between the price of original parts and generic ones.

Minimum Car Insurance Requirements

These are some of the coverages that are generally mandated by law:

• Liability Coverage: This is the primary insurance for leased cars required by most states. Liability insurance may help cater for injuries to others or destruction to property that you cause.
• Uninsured Motorist Coverage: Depending on your state, this coverage might be mandated by law on your auto insurance policy.

Insuring a leased car is just like insuring a car you purchased when it comes to coverage and how your rates are calculated. According to the Insurance Information Institute (III), every person will have different finance options due to variables including age and driving record.

It might surprise you to find out that your age, gender, and marital status can affect your car insurance rates. Bad credit can also sometimes be a variable as some insurers will run a credit check before offering pricing. Let’s look at how much of a difference those factors make.

Car Insurance Monthly Rates by Age, Gender and Marital Status

You can see that older, married females pay the least while young, single males pay the most.It makes sense that your driving record affects your car insurance rates, but do you know just how much one incident will increase your rates? Let’s look at the average rates for a clean driving record versus one with traffic tickets.

Car Insurance Monthly Rates by Provider & Driving Record

You can see that just one infraction can raise your rates significantly. Obeying traffic laws in a simple way to keep your insurance rates low, whether you are leasing or buying a car.

Business Lease Gap Insurance

In addition to your primary auto insurance for rented cars, gap insurance will give you extra protection in case your vehicle is totaled in an accident or stolen.This optional coverage is meant to fill the gap between what your insurer would pay for a typical comprehensive or collision claim and the lease amount still outstanding on the vehicle.

Most leasing agencies automatically include this coverage in the lease payments. Make sure you ask your leasing office if they include lease gap or loan coverage as part of the contract. If not, you can buy this coverage from your insurance provider as part of your auto insurance policy.

How to Save Money on Car Insurance

Whether it’s for an owned or leased car, auto insurance premiums can be pricey and almost everyone dreads paying them. However, with a little understanding, you can make a considerable amount of savings on your insurance premium payments. Here are some helpful tips:

• Insure multiple cars with the same insurance company, or bundle your vehicle and homeowner’s insurance to qualify for significant discounts on your automobile insurance.
• Save more by keeping your driving record clean of any accidents.
• Equip your new car with safety features such as a passenger restraint system or anti-theft device. This could help you save more depending on your insurer and where you live.

Car insurance can be expensive so be sure to ask for all discounts you are eligible for.Leasing is a known strategy for people who plan to upgrade their vehicle every couple of years and would want to buy a vehicle that does not maintain its value.

As the monthly repayments for the leased car do not include the standard insurance coverage, it is the duty of the person or business leasing the car to arrange for insurance- same as if you were buying a car on finance.

The right insurance policy will save you a lot of cash and headache at the end of the lease agreement. Get the cheapest business contract car hire insurance by comparing quotes today. Enter your ZIP code below to get quotes now.