Best Auto Insurance for Leased Vehicles in 2026 (Your Guide to the Top 10 Providers)

Allstate offers the best auto insurance for leased vehicles because of its safe-driving discounts, comprehensive coverage options, and excellent customer service. Other top contenders include Geico and State Farm, which offer competitive rates and discounts for multiple vehicles.

Because accidents aren’t uncommon, insurance is important when you’re leasing a car. In most states, drivers of all vehicles, whether leased or owned, must carry a minimum amount of auto insurance.

Before signing a lease, it’s important to understand your legal and insurance obligations, as they can vary widely.

Always check to see your state’s minimum auto insurance coverage requirements before insuring your vehicle.

Our Top 10 Company Picks: Best Auto Insurance for Leased Vehicles

Let’s explore the lease car insurance requirements every lessee should know before driving it off the lot.

Get the best auto insurance rates possible by entering your ZIP code above into our free comparison tool today.

#1 – Allstate: Top Pick Overall

Pros

• Multiple Discounts Available: Allstate tops our list of best car insurance for leased vehicles because it offers various discounts, such as multi-policy, safe driver, and anti-theft device discounts. Read our expert Allstate auto insurance review to find out which discounts you qualify for.
• Wide Range of Coverage Options: Allstate offers a wide range of coverage options for leased vehicles, including liability, collision, comprehensive, and gap insurance.
• User-Friendly Website and Mobile App: Allstate’s website and mobile app are easy to navigate, making it convenient for customers to manage their policies and file claims.

Cons

• Higher Premiums Than Competitors: Allstate’s average premium for leased vehicles is $160, which is higher than the industry average.
• Limited Availability of Agents: Some customers have reported difficulty in finding an available agent when they needed assistance.

#2 – State Farm: Best for Business Owners

Pros

• Affordable Premiums: State Farm’s average premium for leased vehicles is $86, making it one of the most affordable options in the market.
• Excellent Customer Service: State Farm is known for its excellent customer service, with quick response times and helpful representatives.
• Numerous Coverage Options: Similar to Allstate, State Farm also offers a variety of coverage options for leased vehicles. Learn more in our State Farm auto insurance review.

Cons

• Doesn’t Offer Gap Insurance: State Farm does not offer gap insurance.
• Mixed Reviews: While State Farm has a generally positive reputation, there are some mixed reviews regarding their claims process and rates.

#3 – Geico: Best for Low Rates

Pros

• Lowest Average Premium: Geico has the lowest average premium for leased vehicles at $80.
• Simple Claims Process: Customers have reported a smooth and easy claims process with Geico. Read more about Geico’s claims process in our Geico auto insurance review.
• Multiple Discounts Available: Geico offers various discounts, such as safe driver and multiple vehicle discounts, which can help lower the overall premium.

Cons

• Limited Coverage for Specific Needs: Geico does not offer gap insurance, new car replacement, or a vanishing deductible. Learn how vanishing or disappearing deductibles work.
• Higher Premiums Post-DUI: Drivers with a DUI on their record may face higher than average insurance rates with Geico.

#4 – Progressive: Best for Loyalty Rewards

Pros

• Loyalty Rewards: Progressive offers various loyalty rewards, such as accident forgiveness and deductible savings, for long-term customers.
• Mobile App Features: Progressive’s mobile app allows customers to easily manage their policies and file claims on-the-go.
• Competitive Rates for High-Risk Drivers: Customers with a less-than-perfect driving record may find competitive rates with Progressive. Read more in our Progressive auto insurance review.

Cons

• Snapshot Program Can Raise Rates for Some Drivers: Progressive’s Snapshot program, which tracks driving behavior, may increase rates for some drivers if deemed high-risk.
• Mixed Reviews on Customer Service: There have been some mixed reviews on their customer service and claims process.

#5 – Nationwide: Best for Deductible Savings

Pros

• Vanishing Deductible: Nationwide offers a vanishing deductible program, where the deductible can decrease over time if no accidents occur.
• Accident Forgiveness: Customers can add accident forgiveness to their policy, which means their rates will not increase after their first at-fault accident. We’ve explored about this in our Nationwide auto insurance review.
• Plenty of Discounts Available: Nationwide offers various discounts, such as multi-policy, good student, and anti-theft device discounts.

Cons

• Limited Availability: Nationwide is not available in all states.
• Higher Premiums for Young Drivers:  Young drivers may face higher premiums with Nationwide.

#6 – Farmers: Best for Group Discounts

Pros

• Group Discounts for Affiliations: Farmers auto insurance offers discounts for being a member of certain groups, such as alumni associations or professional organizations.
• Teen Driver Discount: Customers with teenage drivers can receive a discount if their child completes an approved driver education course. 
• Customizable Policies: Farmers allows customers to customize their policies by choosing coverage options and limits that best fit their needs. Learn more in our Farmers auto insurance review.

Cons

• Higher Premiums: Farmers’ premiums may be higher than other insurance companies.
• Multiple BBB Complaints: Multiple complaints have been filed against Farmers with the Better Business Bureau, mainly concerning claims and customer service.

#7 – Liberty Mutual: Best for Accident Forgiveness

Pros

• Accident Forgiveness: Liberty Mutual offers accident forgiveness for drivers who have been accident-free for five years or more.
• Large Network of Agents: Liberty Mutual has a large network of agents, making it easy for customers to receive in-person assistance with their policies.
• 24/7 Claims Service: Customers can access 24/7 claims service, making it easier to file a claim at any time.

Cons

• Higher Premiums: Liberty Mutual’s rates may be higher than those of other insurance companies.
• Limited Discounts: The number of discounts offered by Liberty Mutual is limited compared to other insurance companies. Discover the current discounts offered in our Liberty Mutual auto insurance review.

#8 – USAA: Best for Customer Service

Pros

• Top-Rated Customer Service: USAA consistently receives high marks for its customer service, making it a reliable choice for customers.
• Wide Range of Coverage Options: USAA offers a wide range of coverage options which you can learn about in our USAA auto insurance review.
• Variety of Discounts: Customers can take advantage of various discounts, such as multi-policy and safe driver discounts.

Cons

• Eligibility Requirements: USAA is only available to military members, veterans, and their families.
• Limited Availability: USAA is not available in all states. 

#9 – Travelers: Best for Comprehensive Coverage

Pros

• Comprehensive Coverage Options: Travelers offers a wide range of coverage options, including comprehensive coverage for accidents, theft, and natural disasters.
• Discounts Available: Customers can take advantage of various discounts to save on their premiums.
• Strong Financial Ratings: Travelers has strong financial ratings which we have explored in our Travelers auto insurance review.

Cons

• Higher Premiums: Travelers’ rates may be higher than other insurance companies.
• Limited Online Services: The company’s online services are limited.

#10 –Erie: Best for Personalized Policies

Pros

• Personalized Policies: Erie allows customers to personalize their policies based on their specific needs.
• Lower-Than-Average Rates for Older Drivers: Drivers in their 60s and 70s can benefit from lower-than-average rates. Learn more in our Erie auto insurance review.
• Rate Lock Program: Erie’s Rate Lock program guarantees that rates won’t increase unless certain changes are made to the policy.

Cons

• Limited Geographic Coverage: Erie’s insurance coverage is only available in 12 states and Washington, D.C.
• Higher Rates for Drivers With Poor Credit: Drivers with poor credit face higher average rates.

Cost of Insurance for Leased Cars

As the driver of a leased vehicle, you might wonder, “Is insurance cheaper on a lease?” The short answer is — it’s complicated.

The table below shows the average monthly car insurance rates:

Auto Insurance Monthly Rates for Leased Vehicles by Coverage Level

Maximum deductible restrictions, or limits on the amount of money you must pay out of pocket before your insurance applies, are sometimes also required by lessors. Unfortunately, these restrictions can lead to an increase in your monthly auto insurance rates.

Your Leased Vehicle Won’t Come With Insurance

If you’re asking yourself, “Will my leased vehicle come with insurance?” Unfortunately, leased vehicles don’t automatically come with insurance. Instead, it’s up to the lessee to purchase insurance for their leased vehicle. Your coverage should comply with the laws of the state where your vehicle is registered and meet the requirements of your lease agreement.

When you lease a vehicle, the leasing company will require that the vehicle is insured before allowing you to drive it off the lot.

However, the minimum amount of coverage you’ll have to purchase when leasing a vehicle will depend on the laws of the state where it’s registered.

In addition to complying with state laws, your lessor might have additional coverage requirements for insuring a leased vehicle. Keep reading to compare the types of car insurance you need for leased cars.

State Insurance Requirements

Although the laws governing auto insurance requirements vary between states, most require drivers to carry a minimum amount of insurance coverage. This typically includes liability insurance, which is usually offered in two primary forms:

• Property Damage Liability Coverage: Pays for damage to other people’s property if you’re in an accident. Find the best property damage liability auto insurance companies. 
• Bodily Injury Liability Coverage: Pays for medical expenses for other people you injure in an accident.

Although it’s less common, some states also require drivers to carry uninsured/underinsured motorist coverage and personal injury protection (PIP) coverage. 

It’s important to remember that even when your insurance coverage meets the state-mandated minimum coverage, it might not be enough to cover all damages if you’re in an accident. Because of that, it can be a good idea to consider opting for higher liability limits.

Lease Car Insurance Requirements

What are the insurance requirements for leased cars?

Well, in addition to state-mandated auto insurance requirements, drivers of leased vehicles must also comply with their lessor’s insurance requirements. 

Because leasing companies want to make sure their vehicles are protected, they often impose their own insurance requirements on lessees that can sometimes exceed state requirements. 

Typically, this includes the following types of insurance coverage:

• Collision Insurance Coverage: Pays for repairs related to damage to your vehicle caused by a collision with another vehicle or object.
• Comprehensive Insurance Coverage: Pays for other types of vehicle damage that aren’t a result of an accident, such as theft, falling objects, bad weather, and natural disasters.

Beyond extra coverage, lessors sometimes also require that lessees purchase insurance liability limits that are higher than those mandated by state law.

Gap Insurance for a Leased Car

You’re probably asking yourself, “Do I need gap insurance on a leased vehicle?” Well, because gap insurance covers the difference between a financed vehicle’s actual value and the amount of money still owed on the vehicle, lessors sometimes require it. 

Gap insurance can be helpful when leasing a new vehicle that will quickly depreciate after driving it off the lot, but it makes less sense when leasing a used vehicle that isn’t worth more than the amount owed on a lease.

Read more: Guaranteed Auto Protection (Gap) Insurance

When the lessor offers gap insurance, it is usually in the form of an additional monthly fee or a one-time upfront charge at the time of signing the lease. Some auto insurance companies also offer gap insurance and typically add the cost to your monthly insurance premium.

However, it’s important to remember that there are often limits to gap insurance benefits, so it’s best to check your gap policy to ensure that it meets your lessor’s requirements.

Read our article to find out more about gap insurance on a financed car.

Insurance Is Required for Leased Cars

Do you pay insurance on a leased car? Well, when you lease a vehicle, it’s your responsibility to pay the car insurance for leased cars. Your lease car insurance rates are based on various factors and can vary widely between insurers. 

To ensure you get the best rates, shop around and compare quotes from different insurers in your coverage area.

Auto Insurance Monthly Rates by State & Coverage Level

Learn more about what factors affect your car insurance rates.

How to Get Auto Insurance for Leased Cars

Follow the steps below to show proof of insurance on a leased car to your lessor:

• Ask the leasing company what the minimum insurance requirements are for the vehicle you’d like to lease.
• Determine whether you want to add additional coverage, like gap insurance, to your policy.
• Shop around and compare quotes for car insurance.
• Purchase your preferred policy and ask the insurer to fax or email proof of insurance to you or the leasing company.
• Provide the leasing company with proof of insurance, sign the lease, and enjoy your new vehicle.

For drivers seeking alternatives to leasing a car, vehicle subscription services can be an excellent alternative. 

Offered by several major car dealers, including Canvas (Ford), Care (Volvo), and Book (Cadillac), car subscription services allow drivers monthly access to an insured vehicle with maintenance costs included in a monthly subscription fee without long-term commitments. 

Read more: Volvo Auto Insurance

The Bottom Line on Insuring Leased Vehicles

Car insurance is required to drive a car in most states, regardless of whether you own or lease your vehicle. Although car insurance rates aren’t based on the ownership status of your car, the coverage requirements mandated by leasing companies, which sometimes exceed state insurance minimums, can lead to higher premiums. 

Because insurance requirements and rates for leased vehicles can vary widely, it’s important to shop around and compare quotes before signing a lease. Use our free comparison tool below to get auto insurance quotes from local companies.