Insurance pay out for totaled lease with equity above lease buy out

Anyone have any experience with settling with insurance on a payout that goes above the lease purchase price for a lease that has positive equity and is totaled?

Not sure if they’re going to try to repair it or if they will find the frame is damaged and will need to total it. I want to be prepared should it be totaled.

The other driver was liable for the accident. He had a commercial vehicle/commercial policy, if that matters.

It’s through GM Financial and was for a 2020 GMC Sierra 2500 Denali diesel truck. Obviously, I’m not going to come anywhere close to getting the same deal I had on that truck ($0 down, $772/mo, 15K miles a year, 39 mo lease), so trying to figure out how I can get into a similarly equipped vehicle without any more out of pocket given the fact the other driver caused the accident.

Long story short, it depends on your leasing company and your insurance provider.

Depending on the actual equity itself it may not be worth persuing the legal option if your insurance mucks up and sends the overage if any to your leasing company.

What does your lease contract say?

Also, if it’s through the other person’s insurance because they’re at fault, there may be grounds to go after them for the lost equity value separately, if the bank keeps it, but that’s a separate conversation and should probably be had with a lawyer.

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Here we go
Bill Hader Popcorn GIF by Saturday Night Live


I plan to speak to an attorney. Was just looking here as there seems to be some expertise here related to leases that may be more knowledgeable than some attorneys that specialize in PI.

Unfortunate situation
And these leasing companies have gotten very greedy but than again they own the car… you are just renting it

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I think that trying to blame it on greed isn’t particularly reasonable.

It’s a company that had their asset destroyed and they’re expecting to get market value for the asset. While it’s annoying from the lessee side with potential equity on the line, it really isn’t an unreasonable position for a company to take.


With that said, I could roll the dice, buy the lease out now and try to negotiate for fair market value if it’s totaled. If it’s not totaled, then I have a vehicle that has major accident history, though.

That’s the challenge.

I am hoping it’s repairable and the market is in a more reasonable place when my lease is up in a year and a half.

I’ve said before on a thread like this for a different brand,

Car leasing and insurance shouldn’t work in a way where crashing your lease nets you a 4-5 figure check, because it could create a perverse incentive for people to drive their cars with less care.

Everyone driving around in a vehicle in an equity position should believe/know that their equity will be wiped away in a wreck, and hopefully that encourages everyone (including the thousands of internet strangers that might see this post) to please, drive more carefully. This isn’t directed specifically at you, OP but, in a car shortage, I can’t say it enough. Every car that doesn’t crash helps us get back towards a normal car market.

I understand that not all accidents can be avoided, and it sucks to be involved in a crash, at-fault or not. But, really, the most important thing is that you’re physically okay. A car is just a car.

When a leased car is totaled, typically the lessee walks away from payments, and they do not receive additional compensation. But also, the lessee does not have a balance due, due to built in gap insurance on most leases.


Insurance should work in a way where you’re kept whole if their insured driver causes an accident that totals your car. I know that everything in life isn’t fair and I’m probably going to get screwed here, so I’m just looking for tactics that can help me get screwed as little as possible.

So go after their insurance for the lost equity.

Just because the lessor gets made whole for their asset doesnt mean you can argue your case separately.

If you think you have enough equity, even having an accident shouldn’t put the vehicle at a value below the payoff or at least not by much. That said, if the car does end up being totaled, you probably won’t be allowed to complete the payoff purchase.

While it seems similar to that functionally, it isnt that at all.

You are renting a company’s asset and you have a contractual purchase option that you can choose to excercise.

When someone wrecks the lessor’s vehicle, them being paid fair market value for that asset isnt an unreasonable thing.

You may have some claim to the value of the unexcercised contract option as a further claim, but that’s a separate claim.

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A lot of LH greatest hits here already and only 14 posts deep. Impressive.


This seems like a terrible roll of the dice.

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Ask the insurance company to pay you the overage. Some companies do.

“Overage” means nothing if the bank says the insurance payoff is the full ACV. Your lease buyout price doesn’t automatically apply to the insurance company unless the bank decides it does. So they can just negotiate with the insurance company for the replacement cost of the vehicle and say “great, that’s what the payoff is too”

Someone posted here recently that Liberty Mutual sent him the ‘overage’ as a separate check from the payoff of the lease. So there is a ‘tiny’ chance that OP can ask for it as well.

It all depends on what the bank says the payoff is. The insurance company has to pay them first. That’s how some banks capture the overage - by giving the insurance company a higher payoff amount, which is within their right - thereby no or very little equity for the insurance company to pay to you.

Depends on the Bank and OEM, all I said was ASK, it doesn’t hurt to ASK, and it hurts to not ask.
What you posted was reasonable…but if you don’t ASK you will not get.