when car insurance sends you a check

When Car Insurance Sends You A Check

Getting a check from your car insurance company after an accident or claim can seem like a relief at first. The funds can help pay for repairs, medical bills, or replace your vehicle if it was totaled. However, it’s important to understand what that check

means and what you need to do once you receive it. Rushing to cash the check or spending the money before handling required paperwork can result in problems down the road. To make the most of your car insurance payout, there are several steps you should take.

Being informed and strategic will ensure you use the funds appropriately, fully cover your costs from the incident, and avoid complications with your insurer. Here is a comprehensive overview of what to expect and do when your car insurance company sends you a check.

Assessing the Damage

The first step is to thoroughly assess the damage or costs related to your claim. This will depend on your individual situation:

If your vehicle was damaged in an accident, get a repair estimate from a licensed auto body shop you trust. The shop will provide a detailed quote for parts and labor costs to fix your car. If your claim involves a lawsuit, your attorney and the court will determine appropriate damages.

  • If you suffered injuries, compile medical bills and records related to the accident. Also factor in any missed wages from work due to your injuries.
  • If your vehicle is totaled, research its current value. Consult Kelley Blue Book or Edmunds to determine your car’s worth before the accident.

Carefully calculate the full extent of the costs resulting from the accident or incident. This will allow you to understand how much coverage you require from your insurer.

Assessing The Damage
Assessing the Damage

Reviewing Your Policy

Once you have a complete picture of the costs, review your car insurance policy documents. This includes your policy declarations page, which outlines your coverage details and policy limits. Common relevant coverages include:

Collision coverage – Pays to repair or replace your vehicle after an accident. Usually has a deductible. Comprehensive coverage – Covers damage to your car from non-collision events like theft, vandalism, or natural disasters. Also has a deductible.

Bodily injury liability coverage – Pays for other parties’ medical expenses if you caused the accident. Property damage liability coverage – Covers damage you caused to someone else’s vehicle or property.

Uninsured/underinsured motorist coverage – Protects you if the other driver caused the accident and lacks adequate insurance. Medical payments coverage – Helps pay for your medical treatment after an accident, regardless of fault.

Compare your policy limits to your total costs. This will give you a sense of how much the insurer should pay out for your claim. If your costs exceed your coverage limits, you may need to cover the difference out-of-pocket.

Reviewing Your Policy
Reviewing Your Policy

Deciding on Repairs vs. Total Loss

For damaged vehicles, you’ll need to decide whether to repair your car or deem it a total loss. Generally, if the repair costs exceed around 75% of the car’s pre-accident value, the insurer will consider it a total loss and simply pay out the value. However, you can still opt to repair a car rather than have it totaled.

Think about things like the vehicle’s age, mileage, resale value, and your attachment to the car when deciding. Crunching the numbers usually makes the better option clear. If repairing the car doesn’t make financial sense but you want to fix it anyway, you’ll need to pay the difference.

Deciding On Repairs Vs. Total Loss
Deciding on Repairs vs. Total Loss

Working with the Adjuster

Your insurer will assign an adjuster to your claim. This person is responsible for assessing damages, determining coverage and payout amounts, and authorizing payments. Work closely with your adjuster to submit documentation,

get questions answered, and avoid any issues. Be wary of adjusters encouraging you to accept low initial offers or pushing for subpar repair shops. Know your rights and stand your ground if their offers seem unreasonable.

Working With The Adjuster
Working with the Adjuster

Cash the Check Appropriately

Once you and the adjuster agree on a claim payment amount, the insurer will issue a check. But don’t rush to cash it right away. There are a few steps you should take:

  • Endorse the check properly – Sign the back and write “Without Prejudice” before depositing so you don’t jeopardize your right to additional payments later.
  • Ask if the check equals a full and final payment – Insurers may state the check represents full settlement of your claim, preventing you from reopening it later. Clarify this before depositing.
  • Review the release of liability form – For injury claims, insurers may have you sign a release agreeing not to sue. Review this carefully and don’t sign away your legal rights. Consult an attorney if needed.
  • Ask about supplemental payments – If your costs exceed the check, ask about applying for supplemental claim payments. Most insurers deduct your deductible, so they’ll reimburse that amount if repair costs exceed the check.
  • Negotiate if necessary – If you disagree with the payment amount, negotiate with your adjuster for a higher settlement before cashing the check.
  • Deposit into a separate account – Put the funds in a separate bank account earmarked for your claim-related costs only. This will simplify paperwork if seeking additional payments.
Cash The Check Appropriately
Cash the Check Appropriately

Handling Repairs and Medical Treatment

If you plan to repair your car, select a reputable shop with experience matching paint colors and textures. Get a detailed written estimate and avoid shops recommended by the adjuster. For injury claims,

seek prompt medical treatment from your doctors, not those recommended by the insurer. Keep excellent records of all repair and treatment expenses and save receipts.

Resolving Ongoing Issues

Unfortunately, even after the check arrives, some claims can involve lingering disputes over coverage, fault, damages, and delays in payment. Here are tips for resolving common ongoing claim issues:

Send polite written requests asking the insurer to reconsider denied payments or other unfavorable decisions. Include documents that support your side of the dispute.

File a complaint with your state insurance regulator if the insurer wrongfully denies your claim or drags out the process. Regulators can penalize bad behavior.

  • Hire a public adjuster or appraiser to independently assess your vehicle damage if the insurer’s offer seems low. Their expert analysis could justify a higher settlement.
  • Consult a lawyer if the insurer acts in bad faith or you suffered severe injuries. An attorney can help maximize your payout and make sure you comply with legal requirements.

Consider mediation before taking legal action. An independent mediator can sometimes resolve car insurance disputes through structured negotiation before needing to file a lawsuit.

Resolving Ongoing Issues

Handling a Total Loss

If your vehicle is totaled, you cannot legally drive it. The car’s title will be branded as salvaged or non-repairable. But you still have options:

Accept the insurer’s settlement payment and use funds toward a replacement vehicle. Thoroughly review the settlement offer before accepting. Negotiate for a higher payment if you believe the car’s actual cash value was lowballed.

Provide comparable vehicle pricing data to support your case. Keep the totaled car and hire a specialist to repair it, if desired. But this can cost more than it’s worth. Removing the salvaged title is complex too.

Sell the totaled car for parts or scrap metal. This recoups a bit more value than your insurer’s settlement. Shop around amongst junkyards and salvage yards for best pricing.

If leasing the totaled car, additional rules apply. Communicate immediately with your lender or leasing company to understand your responsibilities for any remaining lease payments.

Handling A Total Loss
Handling a Total Loss

Protecting Yourself from Claim Issues

While most insurers act ethically, claims problems still occur. Here are proactive steps to safeguard your rights and interests:

Document every accident detail, including parties involved, witnesses, vehicle positions, weather conditions, injuries, and property damage. Photos and video provide invaluable evidence. Call the police to the accident scene and obtain a police report. This creates an official record of what transpired.

Only discuss the accident with your insurer and legal representatives, not other parties involved. What you say can be used against you. Read your policy thoroughly and ensure you have adequate coverage limits for likely scenarios in your region. Higher limits provide more protection.

Research insurers’ reputations for claims handling and choose one known for prompt payment and fair settlements. Ask friends for recommendations too. Consider accident forgiveness protection, which keeps rates unchanged after your first at-fault accident. This saves money long-term.

Maintain an emergency fund with a few months’ living expenses. This lets you proceed cautiously with the claim process instead of rushing for fast cash.

Protecting Yourself From Claim Issues
Protecting Yourself from Claim Issues

Following Up Persistently

In addition to the steps covered above, persistently following up with your insurer is key to getting your claim resolved properly.

Check in at least weekly on the claim status and reiterate any unaddressed concerns. Document whom you spoke with and when. Send written correspondence if calls are ineffective. Keep the tone polite but firm. Certified mail provides delivery confirmation.

Ask managers to escalate the issue if representatives give you the runaround or ignore requests. Move up the chain of command until someone addresses the problem. If needed, contact your state insurance department to report.

some examples of common ongoing claim issues that people can face

The insurer disputes the extent of damages or the repair costs, offering a lower settlement. The insurer alleges you were partially at-fault or negligent and wants to reduce the claim payout. Delays in getting claim approval and payment from the insurance company.

The insurance company suddenly finds reasons to cancel your policy after you file a major claim. Issues over uncovered loss – the insurer argues certain damage types or treatments aren’t covered. Disagreements over the value of a totaled vehicle, with the insurer offering too little in your opinion.

Injury claims get complicated when multiple parties share liability. Each insurer tries to minimize payouts. Bad faith tactics like claim denials without adequate investigation or attempts to get you to settle too quickly.

Some Examples Of Common Ongoing Claim Issues That People Can Face
some examples of common ongoing claim issues that people can face

tips for negotiating a higher settlement with an insurance adjuster:

Come prepared with documentation that supports a higher value, like repair estimates, medical bills, comparable vehicle sales, etc. Point out details the adjuster may have overlooked that justify increased payment.

Politely but firmly refute any questionable arguments the adjuster uses to deny full payment. If they won’t budge, ask for a managerial review of the claim decision. Highlight your long history as a loyal customer deserving fair treatment.

Offer to get an independent appraisal done if disagreement is over damages or value. Suggest mediation using an objective third party to find middle ground. Consult an attorney and have them negotiate on your behalf. Insurers know lawyers could take legal action.


process of removing a salvaged title on a totaled vehicle:

The car must be repaired to roadworthy condition by a licensed rebuilder. All safety components must be completely restored or replaced. An enhanced inspection by specially certified mechanics has to confirm the vehicle’s roadworthiness and verify VIN numbers match title documentation.

Extensive paperwork has to be submitted to the Department of Motor Vehicles (DMV) in most states to apply for a rebuilt or restored title to replace the salvaged one.

The owner has to prove valid ownership of the car with a proper title transfer. The salvaged title is surrendered to the DMV in exchange for a rebuilt title. DMV charges fees and taxes to issue the new title. Stiffer regulations and inspection requirements apply in some states, increasing costs.

Going through this lengthy process doesn’t guarantee all states will recognize the new title due to varying regulations. The car still may not qualify for comprehensive/collision insurance either.


Why would your insurance company send you a check?

Your insurer will send a check to cover repairs, medical bills, or total loss value after an accident, claim, or policy benefit triggers a payout. The funds compensate you for covered losses.

Should I accept check from insurance company?

Before accepting an insurer’s check, review it carefully and ensure it covers all your costs. Negotiate for more if it seems inadequate. Clarify what accepting it means for further claims. Consult a lawyer if uncertainties arise.

Should I cash a check from an insurance claim?

Don’t rush to cash an insurance claim check. First, determine if it equals a full and final settlement, and negotiate if dissatisfied. Properly endorse it and deposit into a separate account earmarked just for accident expenses. This protects your right to seek additional money later if needed.

Why did my insurance company send me money?

If your insurer sends money unprompted, it likely relates to a policy benefit entitlement, refund, or adjustment. Verify the reason by contacting your agent or the company before depositing the funds. Make sure it is not sent in error.


Getting an insurance check for a car accident or claim can be a relief, but also presents important considerations. Take time to thoroughly assess all associated costs and review your policy coverages. Determine whether repairing or totaling your car makes the most financial sense.

Carefully review any paperwork from the insurer, including release forms, and don’t sign away your legal rights. Ask questions to clarify if the check represents full and final payment. Negotiate respectfully with the adjuster if their offer seems unreasonable.

Deposit the check cautiously, only once you accept the amount. Use a separate account for the funds, earmarked solely for accident-related costs. Save documentation on repairs and treatment expenses in case you need to seek supplemental claim payments later.

If disputes arise over the value, coverage, or liability issues, persist with the insurance company to resolve them appropriately. Seek legal advice if the insurer acts in bad faith. While most claims go smoothly when policyholders stay informed,

advocate for themselves, and know their rights. With patience and diligence, you can ensure your car insurance check provides the maximum benefit after an unfortunate accident.

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