It doesn’t really matter if you are filing a claim for flood damage, car damage, fire damage, or any other form of damage, but what everyone hopes for is for their insurance claims to end up yielding a fair settlement.
The only problem is it isn’t as straightforward as people imagine it to be, and there are also several ways to go about a cash settlement car insurance claim. If you claim car insurance and your insurance company offers you cash settlement, then it means that your claim was approved.
The good thing is you would be getting money that you are entitled to, and depending on the circumstance, getting a cash settlement might not really be the best way out because, in an actual sense, you are not really getting a settlement for everything you are entitled to. You would learn more about cash settlement car insurance claims and if it is a good move for you or not.
Cash Settlement Car Insurance Claim
What Does Cash Settlement Truly Mean?
When you file a claim after being involved in a car accident, and your insurance company accepts the claim, you would get a settlement offer that would cover up for all of the damages and loss that you must have incurred as a result of the car crash.
If the insurance company tables a cash settlement, it simply means paying you an agreed amount of money as compensation. Cash settlements are considered to be straightforward financial transactions.
This transaction, however, involves the insurance company paying money to the victim of a car crash. In some cases, most people move to collect cash settlement to fix their cars in a body repair shop of their choice or maybe invest the money into something else (which really isn’t the right thing to do).
In other cases, people might choose to accept a cash settlement offer because they are underinsured, and they want the money to be put into repairs they have prioritized.
Another reason any car owner would opt to accept a cash settlement offer is that he doesn’t want to carry out any repairs on the damaged vehicle but has plans to sell off the vehicle.
They might be better off receiving a slashed sales price, accepting cash settlement instead of fixing the damaged car with the money they received from the insurance company. Despite all of these scenarios, accepting cash settlements from an insurance company might not really be the best decision to make.
It is because twenty percent for VAT is already taken off from the settlement that you have received, and this means there is already a twenty percent reduction in the money you are getting.
Another reason a cash settlement isn’t really a good idea is the insurance company would only pay you the equivalent cash value compared to what they would have paid if the repairs would have been carried out by a body repair shop they have an agreement with. These body repair shops most times offer insurance companies preferential rates.
They do this so they can be able to get more jobs from the insurance company.
Cash Settlement Alternative
Some car owners opt for a cash settlement alternative for the insurance company to pay directly for the replacement and repair of the damaged vehicle. In the case of home insurance, they will pay the money to a contractor that has been appointed, and he would be tasked with returning your property to the state it was before any damage occurred.
In other cases, claims get settled through the combination of repairing, replacing, and also getting a final cash settlement.
Both options work towards restoring your damaged property to its initial state. It might be quite difficult to tell from the start which option will yield profitable results or would end up in your best interest, and that is why it is always a good idea to consult with an attorney who would go through your case thoroughly and come up with the best decision for you.
You should meet up with an experienced attorney today if you find yourself in this spot, and he would help guide you through the claims and settlement process.