The next time you are driving through town, take a few minutes to look around at the other cars. It seems to me that ding-and-dent is the new fad. Cracked windows and dragging bumpers are not far behind on the list of new car trends. So, I wonder, are people using their insurance money on other things than repairing their vehicles?
Cars do get old and need some restorative work to look better. But just in my own company’s parking lot, I have seen many cars that are 2007 or newer that are suffering from the ding-and-dent syndrome.
It is obvious to me that these cars have been in an accident. Whether it was with another car, a storefront, a tree, or an enraged Zhu Zhu pet, something out of the ordinary happened. Since most states require some type of minimum insurance coverage, I know that most of these drivers have received payment because of their accident.
A few years ago, another car rear-ended me, and my car ended up with over $3000 in repairs. My insurance company said I had two options. One was to choose a repair shop recommended by my insurance, and get my car fixed. I would owe the deductible, but the insurance would pay the rest. Otherwise, they would send me a check based on estimated cost, minus the deductible, and it would be up to me to find a body shop that could work on it.
That time, I needed my car back and opted to have it fixed right away. But it made me wonder if other Americans are requesting a check, and then not fixing their car. After all, if the car is still drivable, maybe a few dents aren’t a big deal. Especially if you need the money for more important expenses, such as groceries.
This does make sense to me, actually. A lot of people aren’t planning on selling their car anyway, so what are a few dents? But a couple thousand dollar check can really help out the family’s finances, especially in these tougher economic times.
I started noticing dented cars everywhere. On a slow shopping day at Wal-Mart, I counted 20 cars that needed repairs. Now, maybe some of those were newly damaged and were being fixed soon. But I saw some dents that had been spray-painted in an effort to cover them up. One wrecked bumper was completely covered with stickers. These car owners had clearly kept the check and foregone the repairs on their car.
So, this brings up a question of legality. If an insurance company gives you money for your car, and you don’t fix it, are you breaking the law? If not, are there other consequences?
This is not always very clear. I researched this question online on several auto repair websites, blogs, forums, etc. During this research, it became very clear that many people do in fact take the money without repairing their vehicle. But they may not realize the consequences of doing this.
First of all, the majority of today’s car owners do not really own their cars. That is, they have a loan out on the car. In this case, the insurance check is to be used to fix the car because it is not really yours. The lien holder has the right to make sure you have repaired the car to its original condition. If the check has been made to both you and the lien holder, make sure you don’t cash it. This is fraud and you can serve time in jail for it!
If you don’t own money on the car, it is legal for you to keep the check, although it may not be ethical. On one forum, I read of many people who kept the check. Here is what a few of them said:
Shyla: “Sure, keep the check! I got like almost $900 for a little scratch. I couldn’t even tell it was there, so I decided to keep the money and go on a trip.”
Ivan: “Of course you can cash it. It’s in your name, isn’t it? My mom did that. She had an older Malibu that got hit. There was only cosmetic damage, so Mom took the thousand dollars and paid off some bills. She didn’t care about driving an ugly car as much as paying off her credit cards.”
So…what do you think?
Let’s say you get in an accident, but the damage is so slight you can barely tell it is there. Or you can tell, but you can still drive your car. Do you repair it? Or do you keep the money? I believe there are pros and cons to each side.