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What do I do if something happens to a leased vehicle?

  • Blog
  • 30 December 2016

Choosing to lease vehicles for your business means you’re essentially hiring them from a company or manufacturer. This can benefit your business by allowing you to provide a fleet of vehicles for staff in a cost-effective manner. But if something happens to a vehicle, who is responsible and what does it mean for your business?

What do I do if something happens to a leased vehicle?

Wear and Tear

Leased vehicles often come with an agreed mileage allowance. This means that once this agreed number is passed your business incurs a charge per additional mile. This is normally a small sum, like a few pence per mile. However, if this happens across a fleet of vehicles the cost can mount up quickly.

Alongside a mileage allowance, many vehicle lease agreements will emphasise what qualifies as acceptable levels of wear and tear. This often means that small scratches and scrapes, as well as cosmetic damage, are okay as they will happen throughout a vehicle’s working life.

As the user of the leased vehicle, it’s down to you, as a business, to keep an eye on the mileage being used. You should budget accordingly, should the limits be reached and the cost-per-mile fee applied.


More serious damage, like large dents and knocks, are usually not covered within a lease agreement. In the event that a car is damaged, the business using the vehicle will have to pay for the repairs to be carried out.

This usually means that the vehicle needs to be taken to an approved repair centre, which can sometimes be a logistical problem due to the distance between your business and the nearest centre. It can also mean that your leased vehicle is off the road for a time while it is being repaired.

In the event of a collision or serious traffic accident, where the vehicle is more severely damaged and written off, your insurer will have to provide written confirmation of this. You can then use this to negotiate with the finance company you’re leasing the vehicle from.

This can be costly for a business, as many leasing companies will still need you to settle the leasing agreement. Also, as when a vehicle is being repaired, you’re still left short of a vehicle for your business.


Your leased vehicle can still suffer from mechanical faults and breakdowns. Some lease agreements come with roadside assistance and breakdown cover, but it’s important to make sure you have put adequate breakdown cover in place if it doesn’t.

Many lease providers will offer complementary vehicle maintenance as part of the package they offer a business. As with breakdown assistance, it’s worthwhile ensuring this is in place, as it can help to avoid any additional expense, should you need to repair the vehicle.


With work vehicles theft can be an issue and vans are often targets for thieves. Repairing the damage from forced entry to a vehicle can be expensive.

In these situations the only real silver lining is you still have the vehicle. If the vehicle itself is stolen you need to notify the leasing company and your insurer. If the vehicle can’t be recovered, or it is and beyond repair, it can be written off by the insurer.

Much like if the vehicle is written off following an accident, you should contact the insurer and the leasing company in order to settle the leasing agreement. Also, as with when a vehicle is written off, there is a cost incurred for settling the leasing agreement.