The AA has launched a personal car lease product in partnership with LeasePlan UK, which will initially be available to AA members.

Labelled Smart Lease, the service enables customers to see the total cost of driving a vehicle over the course of the agreement and includes fully comprehensive car insurance – provided the customer meets certain qualifying criteria.

The product’s monthly cost also covers servicing and maintenance, Vehicle Tax and VAT, and cars will be available on either a 24-month, 36-month or 48-month contract. Drivers do not need to make an upfront deposit in order to take out a lease, and the car will be delivered to customers’ doors.

Should the customer’s financial circumstances change, such as if they are made redundant or get divorced, the car can be returned without penalty.

If the car has driven more, or fewer, miles than planned during the course of the lease, the mileage plan can also be changed once, at any time during the contract period, with no admin fees.

When the lease ends, the car can be collected or swapped for a new one if the customer signs a new agreement, and any repair costs up to £500 for small scratches and superficial damage will be waived.

Drivers can select from 12 different cars, including three electric models: the Vauxhall Corsa-E, Hyundai Kona and the Volkswagen ID.3. Smart Lease packages start from just £290 a month.

To lease a car, the applicant must be aged 25-75 and have held a full driving licence for more than two years. They must also have no driving convictions and meet the credit score criteria.

James Fairclough, chief executive of AA Cars and AA Financial Services, said: “The car lease market is exciting new territory for our business, and we are thrilled to now announce the launch of our new product AA Smart Lease, in partnership with LeasePlan UK.

“We know the pandemic has been a huge challenge for many of our customers, and a car is a big financial commitment in uncertain economic times. That is why we are enabling drivers to return their car without penalty in certain circumstances, such as redundancy, offering vital peace of mind when many are experiencing uncertainty about their employment and finances.”

Alfonso Martinez, managing director of LeasePlan UK, added: “We are hugely excited to strengthen and enhance our partnership with the AA to bring greater flexibility and confidence to drivers across the UK.

“With a range of electric cars available to choose from, it’s also an exciting opportunity for those looking to make the switch to EV for the first time.”