Insurance Money: Can I Spend It?
Let’s channel our inner Bob Ross for a moment a paint a picture. You got rear-ended while stopped at an intersection. You exchanged information, contacted the insurance company, etc and so on. Now your car is in your driveway with a banged up back bumper and you have a couple hundred dollars worth of insurance money from your coverage to get it fixed. That money, however, could also be used to upgrade your television to a new 4K curved Samsung. After all, the bumper might be beaten up, but the car itself still runs just fine. Are you allowed to do this, or does the money have to go toward repairing your vehicle? What if the same thing happens to your home, can you spend the money then? Well, the answer to that question is a resounding maybe.
There are different factors that must be taken into account. For one, you have to fully own your vehicle or home, meaning you have fully paid off any auto loan or mortgage loan attached to it. If you do not fully own the home or vehicle it is possible you won’t even get the money for the repair. The money could go straight to the auto repair shop. If the money does go straight to you, for whatever reason, it is a good idea to spend it on getting your vehicle or home repaired. Because misery loves company, that beat up bumper might cause more problems later. What if the bumper falls off and hits another vehicle? In this instance you had the means to repair the vehicle but didn’t, placing you fully at fault. The same goes for your home. If you are given money to repair a floor and don’t, then later the floor caves in, that caved-in floor is all on you.
You can also go the middle path and do both. You have to get that floor repaired, but you find someone who can do it for less than the estimated cost the insurance company gave you. Now you can get the floor repaired and spend the rest on whatever you want. You might be able to do this, even if you still owe money. When you owe money on a vehicle, you have to get the approval of the lender to cash a check, which most won’t do unless they have evidence it’s going toward repairs. If the lender sees the repairs are being done and money is left over, it’s possible it could go to you to spend as you see fit.
To learn more about how insurance payouts work, and to get a free quote for your own Auto Insurance, contact O’Quinn insurance today at (386) 516-5721.