Insure Through The Lease Company or Find a Better Deal?
06 August 2014
Novated lease is a great financing option for salaried employees who want to save on tax liability and get their hands on a brand new set of wheels. When computing novated lease, the lease company takes into account the below key parameters –
- Lease financing
- Comprehensive insurance
- Fuel charges
- Registration and documentation charges
- Maintenance charges on tyres, servicing and repairs
Of these, insurance is a significant parameter. The car needs to be fully insured through an existing policy at all times during the novated lease term. While vehicle insurance is handled by separate agencies, some lease companies do cover insurance services as well. If a person is unsure whether to get the insurance done from a separate agency or through the same lease firm, then here are a few points that support the latter -
- Timing – Getting the paperwork done, renewal procedures, payment, customer support, and closure of the novated lease in timely manner is easier when both insurance and lease is handled by the same company and avoids redundant efforts.
- Holistic Financing – With help of getting insurance covered under the lease company, the user can avail of a much clearer picture of the tax liability and FBT component he or she will be liable to.
- Simpler – Instead of following up with two different agencies every time the insurance is due or when the novated lease is up for renewal, users need to contact just a single agency – the lease company – when they need to renew their insurance and novated lease contract.
- Better resolutions – Queries, doubts or clarifications can crop up at any time for a user on issues such as date or terms of renewal, payment options or technical details about the contract. Instead of getting clarifications from an external insurance provider which might or might not sync with the terms of the lease contract, a unified provider will keep all queries with the holistic view of both insurance and lease terms.