Consumers Guide to Auto Repair

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Is it acceptable for an auto insurance company to pay a body shop directly instead of paying the person whose car was damaged?

I’ve had three car wrecks in the past five years. Only the most recent one was my fault. In every case where I had the damage to the car repaired, the insurance company gave the check directly to the shop instead of paying me. This happened both when my insurance company paid and when I got hit by someone else and their insurance company paid. In the end I never really knew the cost of the repairs, and I always felt like I was victim of an underhanded, backroom deal between the body shop and the insurance company. Is it acceptable for an auto insurance company to pay a body shop directly instead of paying the person whose car was damaged?

Ted
Cincinnati, OH

About a month ago I had a fender bender with my car, a 1999 Ford Taurus. It wasn’t my fault. Fortunately, there wasn’t much damage and there were no injuries. I signed a release and settled quickly with the other guy’s insurance company. They wrote me a check for $844, the amount the auto repair shop said it would cost to fix. The next day I put the insurance check in my bank account. With school and everything I had a lot of bills to pay and I had to dip into the money I received for the car repair to make ends meet. Now the money is gone and the car isn’t repaired. I don’t want to get in trouble for spending the insurance check and not fixing my car, but I didn’t have much choice. Things were really tight. I wondered how long I have before the insurance company gets upset with me and demands I pay them back or get the car fixed? Eventually I should be able to put the money back, but it will be three or four months down the road. Is that too long?

Brian
Pittsburgh, PA

I’m uncertain what GAP Insurance is, or if I need it.

My wife and I have been shopping for a new minivan in Columbus, Ohio where we live. We haven’t yet agreed on a particular model, but we have narrowed our choices to three so the dickering won’t be far off. I’d prefer to buy the vehicle outright with 60 month financing, but leasing is not out of the question. My wife prefers the lease since it will allow us to drive a nicer vehicle while enjoying cheaper monthly payments than if we’d bought. Ideally, we would like to put 10% or less down on a new minivan priced around $30,000.

I am told GAP insurance is a must-have on a lease, but unnecessary when buying a new car outright. I need to know the purpose of GAP Insurance and if you would recommend it in my situation. If you can, please give me enough facts about this coverage to keep the dealership from sticking it to me. Your help is appreciated.

Paul
Columbus, Ohio