Last updated 2024-03-14

Total loss settlement on a leased vehicle

Steps on settling a total loss on a leased vehicle.

When this applies

The estimator must discuss the actual cash value (ACV) with the lessor, since the lessor is the owner of the vehicle. The lessee is not the owner of the vehicle. The lessor is the owner and has the final decision in accepting or rejecting the total loss offer.

Procedure

Determine the amount of loss, considering any additional coverage.

If the registered owner has purchased…	Then complete…
Replacement Cost Endorsement (APV286)	the Replacement Cost Endorsement Worksheet (CL30J)
New Vehicle Replacement Plus (NVR+)	the Replacement Cost Endorsement Worksheet (CL30J)
Limited Depreciation Endorsement (APV297)	the Limited Depreciation Endorsement Worksheet (CL30F)
no additional coverage	the procedure to handle a total loss.

Note: These endorsements are additions to the owner’s certificate and do not require a second claim to be opened.

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 following items to the retail selling or lease price, as they are not covered:
- extended warranties
- life insurance/disability policies, and
- agent filing fees.
Issue the settlement cheque.
Important:
- Total loss settlement cheques on leased vehicles are issued jointly to the lessor and the lessee, including any lien holders.
- No allowance for tax 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.
  - The 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.