Best Cheap Car Insurance for Leased Cars (2024)

In most cases, leasing a car involves getting full insurance, including liability, comprehensive and collision coverage. This ensures that in case of an accident, your insurance can pay for damages for both your car and the other party’s car.

Some state laws may also require personal injury protection coverage (PIP), which pays for your medical expenses in case of an accident. Uninsured and underinsured motorist coverage, which covers damages if you get into an accident with a driver who doesn't have any insurance or not enough to cover the loss, is another potential requirement. Aside from state requirements, lessors may request higher liability limits than the state requires or even gap insurance.

Based on our analysis, State Farm has the cheapest insurance for leased cars annually, costing an average of $883 for a full coverage policy. Keep in mind that leasing a car usually involves getting at least full coverage insurance, as most lessors will require it to protect their investment.

Nationwide is the second-best and cheapest provider for leased car insurance, at an average of $930 per year for a full coverage policy.

USAA provides coverage exclusively for the military community, including active-duty, veterans, reserves and their immediate family members. USAA offers the cheapest full coverage rate for leased cars at an average of $679 per year.

At an average of $883 per year, State Farm's full coverage auto insurance is the cheapest coverage for leased cars. Active duty and retired military members can get USAA's coverage for as little as $679 annually. Full coverage insurance is best for leased cars since most lessors require liability, comprehensive and collision coverage.

If you are used to paying for state minimum liability-only coverage, the cost of car insurance for a leased car may seem more expensive, as lessors often require full coverage. However, it comes with more protection, including liability, comprehensive and collision coverage.

If you plan on leasing a car, insurance is something you’ll need to buy. Lessors often require full coverage insurance to protect their investment. After all, leased cars eventually return to the lessor, and it will want to ensure any damage is covered.

Full coverage includes liability, comprehensive and collision coverage, but it can also include uninsured and underinsured motorist coverage, personal injury protection (PIP) coverage and/or gap insurance.

Guaranteed asset protection insurance, or gap insurance, is a type of coverage that can help you recover the difference between the value of the car and what you owe on it. Standard insurance policies don’t cover what you paid for the car — instead, it pays you the actual cash value (ACV). Because of this, some lessors may require you to get gap insurance in case the car gets stolen or written off while you are leasing it.

Even if it’s not required, getting gap insurance is wise if the loan value of your car is greater than the value of your leased car.

While insuring a leased car may be costly — especially if you’re used to the state minimum policies — there are ways to find the best car insurance quotes. You may qualify for discounts, increase your deductibles or shop around to get a better deal.

If you want to know how much you might need to pay, use our car insurance calculator.

Get a deeper understanding of car insurance for leased cars with our answers to some of the most frequently asked questions.