Fender bender..can the insurance company just give me a check to cash?
If you get an auto insurance check for repairs, you aren't necessarily obligated to use it to fix your car. You can keep your auto insurance check cash for yourself and leave the damages to your vehicle unless you don't fully own the car. Before you use the money from your auto insurance check, understand that it may prevent you from getting full compensation in a future accident.
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UPDATED: Nov 12, 2020
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The following is an exported forum post from our discontinued forum. If you would like to reply to this old forum post, please post a comment below.
Some guy hit my truck yesterday while I was in my office working. A slight fender bender… not my fault at all. I wasnt even in the car. I got the guy’s insurance information and everything, and even got an estimate… but I don’t really care about getting the car fixed. I could care less if I have some slight damage to the back of the truck.
The goal of car insurance is to make the policyholder whole again after a loss. If you cause $1,000 worth of damage to someone else’s vehicle, then your insurance company will pay $1,000 to the other driver to fix that damage.
In most cases, there’s nothing wrong with what you’re proposing. The insurance company will analyze the damage and determine how much it would cost to make your vehicle whole again. Then, the insurance company will cut you a check.
At this point, it’s up to you to decide what to do with the check. The insurance company sends you an amount equal to the cost of repairing the damage (including parts and labor), but they don’t really care if you actually repair the damage.
There is one other thing to consider: if you get into another accident in the future, then you may not get full compensation for repairs because there is already pre-existing damage to your vehicle. Let’s say someone hits your vehicle from the back-left side this time, for example. The car insurance company might refuse to cover certain bumper damage because the damage already existed.
Or, let’s say your truck is declared a total loss in a future accident. After investigating the claim, your insurance company decides your truck is only worth $14,000 when it would normally be worth $15,000. That’s because the damage to your bumper impacts the value of the vehicle moving forward.
Because this is a minor, mostly cosmetic issue, however, this is unlikely to have a major impact on your car insurance premiums.
You Must Fix the Vehicle If You Don’t Fully Own It
The way you talk about your truck, it seems to be an older vehicle that you fully own.
Your vehicle is the collateral in a loan between you and your insurance company. If that collateral gets damaged – say, in this rear-end collision – then this can affect the loan. That’s why your financing company or dealership requires you to use the insurance money to fix the damage.
Even Minor Accidents Can Cause Serious Damage
Another thing to consider is that even a minor accident like a fender bender can cause serious damage.
If your fender was damaged in a collision today, then it could be more susceptible to getting damaged in the future. The next fender bender might do more damage to the vehicle because the structural integrity of your bumper has already been compromised.
In this situation, your insurance company could totally refuse a payout for a second accident because you avoided fixing your vehicle.
This type of insurance dispute is more common when dealing with more serious damage – like if your steering was compromised after an accident and you refused to fix it, then got into another accident in the future because you couldn’t steer properly. For a fender bender, it’s unlikely the damage to your truck will affect a future claim.
Ultimately, you should have no problem pocketing the cash from the insurance claim. You’re unlikely to face any consequences by refusing to fix the bumper damage today. However, there’s a small risk that it could impact future insurance claims. Aside from this small risk, you should have no issue with keeping the cash from the fender bender with your truck.
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However, if you get in another accident (god forbid), you won’t get full value for repairs because you will already have pre-existing damages on the car.