QuestionI was recently rear-ended and made a claim through the other parties insurance. the adjuster came out and told me that he would be sending a check to me for the repairs. he also asked me where i wanted my car to be repaired at. now my question is, do i have to get the car repaired or do I able to use money for something else (i.e. bills)? And if i elect not to get it repaired, is it possible for me to get into trouble.
AnswerHello Michael,
No you won't get in trouble. The liability carrier is responsible for your losses. Unlike your own insurance company, the liability carrier has no contract with either you or your lienholder, if you have one. If you had filed a claim under your own policy, your company could require (because of the lienholder) that the check be made out to both you and the body shop. This is not the case with a liability claim. Accordingly, the insurance company cannot insist on cutting a check that includes the name of a body shop.
While it is perfectly legal to use your settlement check as you choose, understand that you could have problems down the road as pertains to the car. If it's an old car with little value and you don't expect much anyway, then you probably won't have a problem. But, if you expect to have resale or trade-in value, unrepaired damages can significantly lower the value of your car.
Insurance company estimates are usually lower than body shop estimates. This is because insurance companies only write the damage that they can see. On the other hand, for example, body shops will often write damages that might be visible only a lift. The point here is that if you accept the insurance company estimate and there is additional damage that would only be visible after a tear down, you are not being compensated for your full damages. And, hidden damages can also contribute to lessening the value of the car.
So here's what I suggest. If you aren't concerned about the value of the car, take it to a body shop and have a separate estimate prepared. Compare that estimate with the insurance company estimate to assure fairness.
In the end, the settlement check needs to be made out to you for the fair value of your loss. The body shop has nothing to do with it.
For more information, you can refer to a blog post which I wrote recently which details this very situation. The link is http://www.floridaautoinsurancecentral.com/2011/09/09/car-accident-claims-how-to
Hope this helps.
Jane Pytel
http://SolutionsForYourInsuranceClaim.com
http://FloridaAutoInsuranceCentral.com
