Liability minimums, gap inclusion, lessor naming conventions, and end-of-term considerations.
Lease agreements often require higher liability limits than a typical state minimum, because the leasing company retains ownership of the vehicle and wants additional protection from third-party claims. A loan, by contrast, usually defers to state minimums on liability and focuses on physical damage coverage.
Many lease contracts also bundle some form of gap coverage into the lease itself, while loan borrowers typically choose whether to add gap separately. Naming conventions also differ: lessors are usually listed as both additional insured and loss payee, while lenders are most often listed as loss payee only.
At lease end, the lessee may face wear-and-use charges that interact with insurance claims. Reviewing the specific lease contract is the most reliable way to understand which coverages are required during the term.
