Can You Keep Insurance Check Instead Of Repairing Car

If you recently got into a car accident, or your machine was damaged in a dissever scenario like if a tree cruel on it, and your auto insurance company came through with a merits check to cover the damages, so congrats! Your car insurance worked simply like it's supposed to.

But now y'all may be wondering if yous have to use that check on the repairs, or if you accept the selection of just keeping the money and living with the damages, or trying to fix your machine on your ain. The answer depends on whether or not you lot own the car outright.

If you lot accept an existing loan on your motorcar, the check must become directly toward auto torso repairs, but if you ain the car outright, y'all may be able to spend the insurance money on whatever you choose, depending on how your insurer paid out the claim.

Key Takeaways

• Some insurance companies send the claims check straight to the auto repair shop, which means y'all wouldn't exist able to pocket the money

• If you charter or finance a car, your lessor or lienholder volition likely get to sign off on how you use the claims payout

• The simply time you can only pocket the claims money is if your country and insurance policy allow it, and typically only if you own your machine outright

When do I accept to utilize an insurance check for car repairs?

Pocketing the payout from an insurance claim may seem tempting, but it'due south not e'er an selection. In many scenarios, y'all won't be able to keep the money yourself, and in some cases, doing and so would actually constitute fraud. You should always cheque your policy requirements when it comes to how you will exist paid out in the event of a claim. Here are some scenarios when you cannot proceed the claim bank check for yourself.

1. When your insurer sends the check directly to an automobile body store

Some insurance companies won't send you the claim check directly, they may require that information technology get directly to a repair shop as a manner of ensuring you're using the coin for repairs. During the claims process, your provider may give yous the option of choosing i of their preferred repair shops or picking your own.

Your provider may make it a little more hard for you to choose your own auto body shop by requiring you to get multiple appraisals, meaning it'south usually easier to go with 1 of their preferred vendors. If you become with an auto torso shop your provider has a human relationship with, your provider will likely pay the shop directly.

2. When you have a lease or loan on your car

If you don't ain your vehicle outright and instead charter it or have a auto loan, then the decision nearly whether or non to proceed the coin from an insurance merits may not exist yours to make. Information technology'due south probable that your loan or lease company is likewise a named insured on your policy, and the cheque from an insurance merits may be made out to both you and the company, so you'll need them to sign off on the repairs before you greenbacks the check.

Your lender's involvement will vary depending on the visitor, but they may crave that you lot use the check for repairs and send them documentation proving that yous followed through.

When tin I go along the check and not fix my car?

If you own your auto outright and your insurance policy doesn't specifically require that the claims bank check go to your auto torso shop, then the coin from a claim is yours, and you can basically practice whatever you desire with information technology. Your insurer fulfilled their responsibility to you by paying out the claim, and, as long every bit your policy and your country's laws permit it, you can go along the money for other uses.

If the impairment to your car was just corrective and you'd rather spend the coin for repairs on something else, you lot might choose to do this. As long every bit you've met your policy's requirements, it'south not fraud for yous to keep the money. Yet, information technology's not always the best idea.

There are few things you should consider before deciding to keep the money.

• In one case yous've already claimed impairment, yous can't claim it again, fifty-fifty if you lot don't utilise the resulting money on repairs

• Claiming the same damage again on a future accident tin get you charged with fraud

• Not making repairs and then you tin can use the claims money elsewhere could also mean gambling with your safety

Even if y'all recollect the impairment to your vehicle from an accident or incident isn't that bad, it's still important to get confirmation from a professional before you lot decide to but live with it or try to repair it yourself. There could be more serious damage than you realize, which might current of air up costing more than coin and headaches down the line if you don't prepare information technology now.

What if the insurance check is more than repairs?

In short, yep, you practice get to keep the money if the check ends up being more than repairs. That said, since the insurance company typically cuts you a check after the car body store, claims adjuster, or appraiser inspects the damage and gives them an judge, odds are the leftover money from the check will not be that much. However, you do not have to return that coin to the insurance company.

Frequently asked questions

When a machine is totaled, who gets the check?

If your car is totaled (and your policy includes comprehensive and collision coverage) you'll pay your deductible and then your insurer will pay yous the value of your totaled car. You'll probably get what'due south called the actual cash value, pregnant depreciation is factored into your reimbursement. If you withal owe money on your auto or it's a charter, the check may go directly to your lender or lessor, and if the value of your car is less than what you all the same owe, gap insurance can make upwardly the difference and pay off your loan or lease.

Is it fraud if I don't apply the claim money to repair my car?

Laws and regulations regarding car insurance claim checks may vary from land to country. If y'all charter or finance your car, pocketing the claim coin may be considered fraud. Notwithstanding, if you own the automobile outright and the insurer sends your claims bank check directly to y'all (not an motorcar body shop), then the check is yours and yous tin can use information technology how you want. Keep in mind that not making necessary repairs to your vehicle may exist unsafe (and even illegal depending on the severity of the damage), and claiming the same damage again on a future claim would exist considered fraud.

What if the insurance check is less than repairs?

If yous don't believe you received the payout that you lot deserved, contact your insurance claims department. Try to provide as much documentation of the before and after from the damage. Y'all may besides desire to consider hiring an contained appraiser to get an additional quote for the repairs, which you can then bring to your insurer to help make your example.

Anna Swartz is a managing editor and auto insurance expert at Policygenius, where she oversees our car insurance coverage. Previously, she was a senior staff author at Mic.com, equally well as an acquaintance writer at The Dodo.

Kara McGinley is an editor and licensed dwelling house insurance expert at Policygenius, where she writes about homeowners and renters insurance. Every bit a journalist and every bit an insurance expert, her piece of work and insights have been featured in Kiplinger, Lifehacker, MSN, WRAL.com, and elsewhere.

Source: https://www.policygenius.com/auto-insurance/do-i-have-to-repair-my-car-with-an-insurance-check/

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