Keeping insurance claim check vs. repairing hail damaged car

Can’t I Just Keep My Insurance Claim Check?

You have no garage and a recent hailstorm left your car with more scars than Edward Scissorhands. You file a claim, pay your deductible and receive a check for damages from your insurance company. But could you simply pocket the cash if you want to? Spend it on something else?

Firstly, if you don’t own your car outright (you have a loan or are leasing), then you have no choice. Your loan holder will require you to use the claim check to pay for repairs. In fact, your insurance company might even write the check to the repair company directly. If somehow you pull off not getting it fixed, you could be dropped from your insurance company or accused of fraud.

If you own your car outright, using your claim check for repairs is ultimately up to you. However, here’s a few reasons why we recommend you should still get it fixed.

4 Reasons to Repair Your Hail Damage

  1. Depreciation.
    Fixing damages maintains the value of your vehicle. In the future, you will be selling or trading in your car at a lesser value if it has hail damage. Websites with vehicle history services like CARFAX will note any reported damages including hail damage. Not to mention the damage will be noticeable during any basic pre-purchase inspection. In some states, the damage will be noted on the title, making it harder to value or insure.
  2. Total Loss.
    If your vehicle is declared a total loss someday (due to collision, flooding, irreparable storm damage, etc.), your insurance company will subtract the amount of this hail damage payout from your vehicle’s total value. Let’s say you planned on a $10,000 insurance settlement for your totaled car. If you didn’t use a previous $1,000 claim check for repairs, you will only get $9,000 (minus deductible and taxes) due to your prior negligence.
  3.  Future Damages.
    If you live in an area with a lot of hail, odds are this hail damage won’t be your vehicle’s last. When the next big storm doubles the amount of dents in your hood, your insurer will subtract the amount of the previous hail damage claim check from the new claim check. You will still receive an amount for the new damages, but it won’t cover the preexisting damage.
  4. Safety.
    After severe hailstorms, your vehicle may not be safe to drive. If your area was hit with hailstones the size of grapefruit, essential functions of your car may be compromised. This is something you can ask during your auto hail damage assessment, completed by your insurance adjuster and paintless dent repair shop. Make sure if you go back out on the road without repairs, it’s safe to do so.If repairs will cost more than the vehicle is worth or you simply don’t mind some unnoticeable dings, you are not required to use your claim check to fix your car if you own it. However, if you want to maintain the value of your vehicle, you should fix your hail damage.