New Vehicle Protection Coverage

[Ferarri]

I have a question about new vehicle protection coverage and how it works. My car was damaged in the summer hail storm and the auto body shop has declared it a total loss. My insurance company is starting the process with me and thankfully I have 5 year new vehicle protection insurance.

The policy states:

In the event of a total loss, your vehicle will be replaced with a new vehicle with the same specifications and equipment.

The vehicle involved in the hail storm was being leased. Has anyone been in a similar situation when it comes to leasing a car that was deemed total loss? What happens to my lease and any other sort of compensation I would receive.

[powderjunkie]

Username does not check out.

[malcolmk14]

What did the place you’re leasing from say when you asked them?

[bizaro86]

Originally Posted by malcolmk14

What did the place you’re leasing from say when you asked them?

I assume he hasn't asked because he's hoping that he can get the insurance company to buy him a newer version of the same car. Then either buy out the lease or keep making the lease payments and pay the residual at the end and get a new one for way cheaper than otherwise.

Maybe that works? I really have no idea, but that's what I'd be hoping for if it was me.

[GioforPM]

We just barely missed the new vehicle limit (we did get a decent settlement on the value though).

But we never lease so IDK.

[PepsiFree]

If someone is leasing they don’t own the vehicle, so I would assume the insurance company just pays out the leasing company and leasing agreement ends once the poster has paid out anything that’s required at that point (at which point they could lease a new vehicle).

Or am I way off.

[DoubleF]

Originally Posted by PepsiFree

If someone is leasing they don’t own the vehicle, so I would assume the insurance company just pays out the leasing company and leasing agreement ends once the poster has paid out anything that’s required at that point (at which point they could lease a new vehicle).

Or am I way off.

Pretty close to what I remember the agreement was when I leased my vehicle/lease buyout.

OTOH, in the event of total loss, then you speak to the lessor and it's their responsibility to get you in an equivalent vehicle (it's not your vehicle). In the event the insurance payout is lower than cost of getting you into an equivalent vehicle, you don't pay extra. In the event insurance payout is higher than the cost of getting you into an equivalent vehicle, you get to keep the difference. I bet they'd manipulate the numbers to be exactly the same, but either way, shouldn't be money out of your own pocket. The original lease payments should transfer to the new lease almost like a credit, minus maybe some tweaks if they had to put you in a higher trim model or lower trim model.

But there may be different lease agreements out there, so I don't know if OP's is different.

I used to think leasing vehicles was throwing away some money, no matter what. But I remember this clause making me realize if I could only save one of two vehicles in a storm, it makes far more sense to let the leased one get destroyed than the vehicle I had fully paid off. It was also sorta like a tiny extra layer of insurance where I could cut my losses and walk away if there was a serious problem with the vehicle. Rare scenario though.

[McG]

Originally Posted by powderjunkie

Username does not check out.

I’m recommending to the OP to check the spelling on the car logo because I think he bought a knockoff.

[the-rasta-masta]

I just bought a new Honda CRV, and ultimately financed it but was looking into leasing.

Not sure if it's the same with all companies, but if you lease with Honda, in the event of a total loss Honda would provide a brand new version of the vehicle through the leasing insurance so I was told not to pay for that new vehicle protection on the personal vehicle insurance side, if I had gone down the leasing route. You likely have two different options to have the vehicle replaced, but have perhaps been paying extra premiums on the insurance side that was already covered on the leasing side.