Full Coverage Car Insurance for a Leased Car
Reader’s Question:
My son is financing a vehicle in Rapid City SD. He can’t afford the car insurance that is required by the car’s lienholder. What can happen to him legally and financially for not carrying the proper insurance on a financed vehicle? Can the finance company take his vehicle back for not keeping his insurance?
John
Rapid City, SD
Until your son completes paying for the vehicle, it belongs to the finance company in Rapid City. His finance company is probably requesting he carry collision coverages and comprehensive for the car.
These coverages will assist cover the car up to its actual cash value – so they can recoup the value of the car if it is a ‘total loss’ in an accident. If he does not carry collision and comprehensive coverages, they can force him to carry their collision and comprehensive coverages (to protect their investment) at much increased rates. They can also repossess the car which will impact your son’s credit negatively.
