Companies that lease company cars from the big lease companies often give incentives to take another car instead of getting a new one. For example getting a car already being leased and get one above your grade without paying for it. Effectively giving you a grade or two boost on company vehicles for free. Okay you still pay the BIK.

If you lease a car personally then surely you've signed up for the contract and must pay the full cost for the period of the lease. Without paying for cover to terminate this early then you have a problem.

I knew someone taking a car via (I think) PCP and he took out cover to terminate early. He swapped jobs so did exactly that without any penalty apart from a small monthly charge up to the point of giving the car back.

When I took out my 3yr Contract Hire (with Dragon Lady) at New Year I looked into this. Yes basically your must look at a worse case scenario where you are responsible for the full term unless a penalty is paid or some figure worked out with the lease co.

The poster above is correct Dragon Lady sources via different lease providers, each with slightly different conditions so it's the specifics of your own particular contract that's important.

I've just looked at my contract and on early termination I'd be due to pay... All payments due to the end of the contract (less a 4% per year discount on these for each year early you finish) *plus* penalty/collection/auction/etc fees which could be £1000 *less* the amount the car fetches at auction.

So basically as movilogo say if you don't think you can do the full period then look at other ways of providing a car.

>> Anyone for whom that is a concern should consider taking out redundancy insurance,

Anyone with such a concern should either not lease or buy in cash. Simple.

On a personal level I agree with you - avoid the commitment in the first place if you are in a position to do so, or can do without.

That's not much help though for somebody who needs a decent car, perhaps to work, and has plenty of income but little ready money (or other uses for it). Some form of deferred payment could be a solution.

Of course anyone taking on commitments should consider whether their income might reduce unexpectedly and decide whether they need some form of protection.