This is a question about auto insurance. My car was hit from behind by another driver. The other drivers’ insurance is paying for repairs. The insurance company offered to write a check out to me which surprised me a little because I assumed they would just pay the auto body repair shop whatever they agreed upon price was.
It kind of seemed like they wanted to write it out to me, but they told me they could do it either way.
I’m not sure why they wouldn’t just pay the body shop. Is there something I’m missing? Is there is there an advantage one way or the other? Is there a reason they would rather write the check out to me personally instead of to the auto body shop?
Payment to myself or to Auto Body Shop
byu/Alarming_Jeweler_717 inInsurance
Posted by Alarming_Jeweler_717
2 Comments
You usually have the option to be paid or have the shop paid directly. I prefer to use the pro shops that work directly with my insurance company, it really is more convenient for me that way. Others might prefer to take it to an independent shop.
You’re the owner so they’ll normally make the check out to you unless you tell them otherwise.
Having the first check sent directly to you is also your *leverage* if you go to pick up the car and the repair is not to your satisfaction. You can simply refuse to pay the balance of the bill until they fix whatever it is you’re unhappy with. If the body shop already has all the money they can simply refuse to address your concerns if they deem them too minor to be bothered with.
The other reason they write the check out to you is because it really is your money to do whatever you want with. A not small number of people simply cash the check and never fix the car. About 50% of body repairs require supplemental payments. If you never fix the car then the odds of a supplement being needed drop to 0%. They also don’t have to pay for a rental car in some cases. So the insurer saves a bit of money, on average, for every person who blows the cash on a new TV or a vacation trip instead of fixing their car.
There’s even some element of altruism in it sometimes. When I’m in the field writing up a hail-damaged car, and there’s no lien on the car, I always tell the owners to pocket the portion of the repair for the roof on any vans or trucks, as long as there’s no splits in the paint that will start rusting. Nobody is ever going to see the hail dents in your roof on a vehicle like that unless they’re looking out a second story window.