Returning a leased car with damage.

What should I do if I damage my lease car?

We very much understand that, sometimes, accidental vehicle damage cannot be avoided. Below is a step-by-step guide to what to do as soon as your lease car suffers damage.

Exchange details with the third party

If other drivers were involved in the incident, make sure you exchange names, details of their insurance, and licence plate numbers. This way the relevant insurance providers can be notified, and you and your leasing company will have a means of negotiating with the other parties if necessary.

Call your leasing provider

Speak to your leasing company as possible to let them know what has happened.  This will enable transparency about the incident and mean they can assist you with whatever they need to, to get you back on the road.

What will happen next?

Once you have contacted your lease provider, they will discuss the matter directly with your insurer, to arrange for the vehicle to be repaired. If your lease car is written off, the insurer will make a payment directly to the lease company, based on the vehicle's estimated value at that time. 

Depending on the type of lease agreement, your leasing company may also provide you with a courtesy vehicle. When arranging a new lease, you should advise your Account Manager if you would like to add this optional service to your agreement.

How much will I have to pay for damage?

If you return your car to the leasing company damaged, they will charge you for the repairs they have to carry out. Of course, it depends on the scale of the damage, but it can often therefore be much more cost-effective to get damage fixed by a mechanic yourself rather than through the leasing company or financing house. 

Do make sure you use a mechanic at a VAT registered garage that is used approved. Hopefully, with all the savings you’ve made leasing a car, any damage you might have to pay for will feel like a worthwhile investment. And, of course, if you owned the car you would have to do it anyway!

What are the BVRLA fair wear and tear guidelines?

The British Vehicle Rental and Leasing Association has set out some national guidelines that leasing companies have to abide by to prevent them from charging their clients undue fees. These will protect you from paying for wear and tear that is deemed usual or inevitable. This is called a ‘fair wear and tear’ guide.

Check out our complete guide here

What counts as fair wear and tear?

Fair wear and tear, as defined by the BVRLA, is the deterioration of the vehicle that will occur naturally over the course of the usage period. 

Do make sure to have an in-depth conversation with you leasing broker or dealership about what they expect from you in terms of normal usage when you lease the car.

What does not count as fair wear and tear?

Your leased car’s warranty will cover mechanical faults (things which go wrong that should not), and if your package includes maintenance, this covers you for servicing and tyres*. Anything beyond this that has occurred due to human error will not be paid for by the leasing company, and you will be responsible for fixing it yourself.

In short, any damage sustained from one single event, such as a dent or flaw caused by a collision or accident, does not count as fair wear and tear. 

*A select few funders do not include tyres in their maintenance package. Your account manager will make you aware of this is applicable.

Check out our fair wear and tear guide here for further information.

Can I dispute the charges?

As with any transaction, you are entitled to raise a dispute if you feel that the charges are unreasonable.

Under BVRLA rules, you have the right to pay for an examination of the evidence by an independent, unbiased and qualified engineer. The engineer's decision will be binding on both you and the leasing company. If it is decided that the leasing company’s charges were excessive, they will be obliged to refund you the difference.

How can I avoid the damage charges?

If you make sure you are treating your vehicle as carefully as you would if you owned it, you shouldn’t have any problem at all. Well-looked after vehicles rarely incur damage charges. And if something accidental does happen – don’t worry. Be open with your leasing company and they will talk you through it. At Leasing Options, we pride ourselves on being transparent about our charges and doing everything we can to reduce our customer’s costs.

What happens if I damage my lease car and it wasn’t my fault?

The most important thing in cases like these is that all third party’s relevant information is taken down at the time of your incident. This way, the matter can be taken up with your car insurance provider, who can mediate resolution of the costs and damages as they would if you owned the vehicle.

It’s important to note that any damage to a lease car is the responsibility of the person leasing the car, regardless of how it was caused. If the damaged was caused by a third party, you may be able to claim on their insurance, directly from the person responsible or under your own insurance policy, but this must be resolved before returning the car to the lease company. For details on what is considered ‘fair wear and tear’, please check out this guide.

GAP Insurance

GAP insurance, or Guaranteed Asset Protection, is insurance that will top up your usual insurance pay-out at the current value of the car, up to the amount required to settle your lease agreement. This could help you in a situation in which you write off your car and end up owing your lease company the excess amount required to terminate your agreement.

You can find out more about how GAP insurance works, and whether it might be relevant to your situation, in our dedicated guide on the subject.

If you have any further questions about damages to your lease vehicle, you can get in touch with our dedicated customer services team here. Happy leasing!