Last updated 2025-05-29

Settle a total loss on a leased vehicle

Steps an estimator performs when settling a total loss on a leased vehicle.

Prerequisites

A leased vehicle with an open or closed lease agreement is deemed a total loss.

When this applies

The total loss must be settled, based on the type of lease agreement with the lessor having the final decision in accepting or rejecting the total loss offer.

The terms of a lease agreement will
  • indicate whether the agreement is an open or closed lease agreement, and
  • determine how to calculate the vehicle's value.
Important: Refer to the Lease Company List on the MD SharePoint site to determine who to contact to discuss the total loss offer.

Procedure

  1. Review the terms of the lease agreement to determine whether the lease is an open or closed lease.
    Note: For closed lease agreements, at the end of the lease term, the lessee is required to return the vehicle, and does not have an option to buy the vehicle. A lessee does not have a vested financial interest in the vehicle.
    If ... Then ...
    a closed lease refer to the topic, Dealership, rental provider, garage service operator, or lessor (closed lease).
    an open lease

    ICBC pays fair market value to the lessor and lessee.

    Proceed to step 2.
  2. Determine the amount of loss, considering any additional coverage.
    If the registered owner has … Then complete the …
    purchased a Replacement Cost Endorsement (APV286) Replacement Cost Endorsement Worksheet (CL30J).
    purchased a New Vehicle Replacement Plus (NVR+)
    purchased a Limited Depreciation Endorsement (APV297) Limited Depreciation Endorsement Worksheet (CL30F)
    no additional coverage procedure, Manage a confirmed total loss vehicle.
    Note: These endorsements are additions to the owner’s certificate and do not require a second claim to be opened.
  3. Determine the retail selling price or the lease price for the amount to use on the applicable worksheet, by referring to the lease contract line (1).
    Important: Do not add any of the items to the retail selling or lease price, as they are not covered; including,
    • extended warranties
    • life insurance and disability policies, and
    • agent filing fees.
  4. Issue the settlement cheque.
    Important: Total loss settlement cheques on open leased vehicles are issued jointly to the lessor and the lessee; including, any lien holders, although no tax allowance is payable to the lessor. After receiving proof of a lessee’s insurable interest, a tax allowance may be included in the total loss settlement and proof of insurable interest letter should include the lessor's official letterhead. A tax allowance can be included in the total loss settlement as per the tax allowance. Refer to the Guide – Taxes and Claims Payment on the hub.
Parent topic: Total losses and salvage