Do I Have to Fix My Car With the Insurance Money?
When you’re waiting for a payout from the insurance company to cover the costs of vehicle repairs after a car accident, you may understandably wonder if you must use that money to fix your car. After all, you may have more immediate financial needs after a crash than getting your car fixed. Shouldn’t you be able to use the money how you see fit?
Perhaps, but it’s not always that simple. Sometimes your insurance company may require you to spend the settlement money on getting your car repaired, or they may send the money to the repair shop directly.
The Colorado car accident lawyers at Earl & Earl, PLLC, have handled thousands of auto accident claims. We know how important your settlement money is to you. Let us help you understand the factors that dictate how you can use it. Keep reading, or call our office today for a free consultation for personalized advice.
Who Owns the Car?
If you’ve leased your vehicle or are still making loan payments on it, your insurance company will most likely pay the repair shop directly instead of cutting you a check. This is because you don’t technically own the vehicle and the insurance company wants to protect the lender’s interests. If this is the case for you, you won’t have the option to keep the check for yourself.
If you own your vehicle outright, it’s a different story. In this situation, your insurance company will likely write you the check. Under the terms of your insurance policy, you may still be obligated to spend the money on repairing your vehicle. But if your insurance policy does not specify that you have to spend the money you receive on repairs, you can spend the money as you see fit.
Is the Car a Total Loss?
If your car is deemed a total loss (sometimes referred to as a vehicle being “totaled”), the insurance company will not pay the repair shop because they’ve ruled that the cost of restoring your vehicle to working condition isn’t worth it. When this happens, the insurance company will send a check directly to you.
However, you will most likely not be able to keep your damaged vehicle and pocket the money. Most insurance policies require you to turn over your vehicle to them as a condition of receiving a payout for a total loss.
What Does the Fine Print of Your Insurance Policy Say?
Determining how you can use money from your car accident settlement in Colorado will be outlined in your insurance policy. If you have any questions about your policy, don’t hesitate to talk to an insurance representative or your car accident lawyer.
Contact a Colorado Car Accident Attorney Today?
Still have questions about how you can use your insurance proceeds after a car accident? Contact Earl & Earl, PLLC for a free initial consultation. We’re here to help.