Whether or not the auto insurance company will make out a check to you once a claim is made is going to depend on a variety of factors. The company, policy and circumstances surrounding the accident are all involved.
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Issues an auto insurance company deliberates over before issuing a check to the rightful party or parties are the following:
- Is there a lien on your vehicle or not?
- Whose fault is the accident?
- What type of coverage do you have?
- What is your deductible?
Read on for more specifics of how this decision is made.
What if I own the vehicle outright, can’t I get a car insurance check in my name only?
Yes, if you own your vehicle outright, then you should be able to get a check cut in your name. So, if your insurance company doesn’t do this, you should simply go back to them and let them know you own your car free-and-clear and that you would like a check cut in your name.
The insurance company may ask for proof of your ownership of the car before doing this, but otherwise there should be no issue. You should have no trouble proving you truly own the car.
If you decide not to use the check to fix your car, that is your legal right when you fully own your vehicle. But understand that if you try to get the same part fixed later on and submit a claim then that is deemed as fraud. Moreover, if you get into another car accident and the same area of your car is damaged, the insurance company may or may not issue a check if they find out that you never applied the first check towards repairs to that part or area of your car.
What if there is a lien still on my car?
Then there will be both your name and the lien holder or the body shop on the check. Sometimes, the body shop will only be on the check. The reason why the insurance company does this is because, when you financed your vehicle, the lien owner required you to have a certain level of insurance to protect their investment (the auto you are in the process of paying off). So, because you have not paid of the vehicle, then the insurance company is obligated to either cut a check in the lien holder’s or auto shop’s name as well as yours.
Sometimes, if you only owe a few more payments to your vehicle, and you really don’t want to get your car fixed, you can ask your lien company if you can apply the insurance payment towards what you owe on the car – sometimes the company will accept these terms.
What if I don’t want to take it to the auto shop my insurance recommended?
That is fine. You may have to get a new check re-issued to the auto shop you have chosen. You may find that the auto shop you have chosen has a better rate than the one the insurance company recommended.
Be sure you get your car appraised for its damages by a third party auto body shop (which they will do for free). If, for some reason, the amount the auto body shop is quoting and the insurance company adjuster is claiming don’t match, then you should definitely negotiate that with your company before you sign any paperwork letting the insurance company off from the liability of this claim. Once you or the auto body shop that you have chosen has negotiated an amount with your insurance provider, make sure that everything that is supposed to be fixed will be, and then you should be good to go.
What if the check is being issued by the insurance company of the other driver who was at fault?
Then a check can be put into your name because the insurance company should not care if your car has a lien on it or not. An insurance company in this situation is simply paying out for the damages caused by their insured driver; therefore, whether the car is owned free-and-clear by you is inconsequential to them.
But realize that this is usually a lengthy process if you wait for the other party to admit wrong doing, and if you do that you may be out of a car for a while. What usually happens, because people mostly need their cars fixed as expeditiously as possible, is that one will go through his insurance company first once an accident occurs. Therefore, the individual is back to the issue of whether his car has a lien or not.
If and when the other insurance provider accepts responsibility for the accident, it will simply reimburse your insurance provider all money it has paid out thus far (plus your deductible, which your insurance company didn’t cover).
What if I don’t own my vehicle and only my name is on the check?
Although tempting as it may be to cash the check and use the money for something else, this is fraudulent and not recommended. Also, usually sooner or later the insurance company or your lien company will realize a check was issued to you, and wonder what repairs you had done to the car. If you have no proof of repairs, you will be forced to get that money back to your insurance company, and my face legal problems.
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