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Insurance Providers Will Not Pay Out Directly The Insured

Once an automobile insurance claim has been made, the most important thing on any owner’s mind will be when their claim pay out is coming. Till the point as the insurer finishes their forms and completes the claim, the owner’s vehicle will possibly sit in the mechanic’s shop waiting for repairs, and the owner will get left with either no way of transportation or they will have to rent a vehicle in the meantime which the insurer will only cover the rental charges for so long.

When you file a claim the result usually means higher car insurance rates. Once the claim process has started clients wish to have it finalized as soon as possible. And for the obvious reason, you want to get your car repaired and back on the road for your own use. When cliams are filed, it can be faster for the insurer to pay the claim directly, but an insurance firm will never pay out to an individual person. They will pay out onlyl to a qualified and credible auto mechanic.

Here are a couple of reasons why. The main reason insurance crime which isn’t obvious to those that file a claim in honesty. Recently, on American Greed Scams, a major operation of insurance theft was discovered resulting in hundreds of thousands of dollars in losses. All of the claims where fraudulent and the police, insurance fraud investigators where involved.

This is not to say you are filing a claim falsely, but insurance companies have been scammed before and have to take precaution when paying out a claim. An insurance firm wouldn’t do well to pay out to a customer immediately, as body shops will most likely give different guesstimates dependent on the wants of the shopper as well as their work charges. This is primary reason of pay-out delays.

Insurance firms know different guesstimates can have varying dollar amounts attached to them, and this in turn implies that a company which pays out an insured immediately cannot make sure that they are paid for what the claim should be. Add to this the incontrovertible fact that there isn’t any guarantee that an inured will use the money to repair their vehicle and in many case you can see where issue may emerge, which is based on past fraudulent activity of others.

If that’s the case they may sign control over it over to the insurance corporation and be paid out at once for the value of the auto on the existing market, mixed with their upkeep of it and the general condition of the automobile. As well as issues with insurance fraud, giving money to a customer for repairs implies that an insurer may not know if repairs were finished by an approved mechanic.

If they weren’t, they could probably lead straight to a future accident caused not by driver accident, but mechanical failure, and this represents a significant risk level for any insurance corporation. Paying a technician at once will continue to be the most preferred system of claim pay out. While auto insurance rates will rise after a claim, most insurance firms do their best to make certain that claims are handled with a considerable amount of respect to get the insured on back on the road and their vehicle back under their own control.

Greg Fowler

Greg Fowler

Managing Member of AutoInsureSavings LLC, Greg enjoys writing articles to help drivers save on anything related to automobiles. Travel and enjoying the outdoors are some of his hobbies. The best way to reach him is at Google+ or Facebook Profile.

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