I received an email from a friend of mine who’s a commercial underwriter with a local insurance brokerage. All three of their cars were struck by hail from Sunday night’s storm. Two of the three vehicles are total losses and she wanted to know their options so they could make a good financial decision that right for them.
Lots of people in the area from Justin, Denton, Highland Village, Lewisville, Frisco, McKinney and Little Elm will have some major decisions to make if their vehicles are determined to be a total loss from hail damage. I thought it timely to reprise a post I wrote last year after the three hail storms rocked north Texas. Let’s examine what car insurance coverage applies, determining whether to file a claim, and options if your car is totaled.
Hail coverage: The two biggest deductibles on a Texas car insurance policy are referred to as collision and comprehensive. Collision applies to accidents or wrecks, while comprehensive coverage applies to a variety of events including hail damage. If you have comprehensive coverage, then hail damage is covered. Deductibles range anywhere from $100 to over $1,000 depending on what you selected.
Rental reimbursement: Most people do carry rental car reimbursement coverage. This pays for a rental car whenever your car is in the shop for an approved claim. If you don’t have this coverage, then you’ll have to pay out of pocket for the rental car, or beg everyone you know for a ride. Given the probable number of damaged vehicles, body shops will be backed up. This coverage certainly helps if your car’s in the shop for 3 or 4 weeks!
File a claim or not: In cases where there’s minor damage to your vehicle, I suggest getting an estimate at your local body shop and comparing it to your comprehensive deductible. This will help you determine whether filing a claim is worth it. Now if your car was severely damaged, then proceed directly and file a car insurance claim.
Repair Shop Options: Many of my clients wonder where to take their vehicles to have them repaired. Most of the larger body shops (Herb’s Paint and Body, Service King, Caliber, etc.) have direct relationships with most car insurance companies. Progressive has their own concierge shops in the area where you can drop the car off, file a claim, pick up a rental car, and be on your way. If you don’t like any of these options, remember, Texas state law allows you to get your vehicle repaired at the shop of your choice.
What if it’s totaled: I’ve had several clients whose cars were totaled by hail. The decision each of them made was whether to accept the payment for the total loss and give up a perfectly running but dimpled car or keep it. The choice is yours. If you decide to give up the car, then you’ll be able to replace it with a new or new to your car, provided there’s enough money to pay off the loan or lease.
If you determine to keep the car, you’ll be given a lesser amount of money for the damage. Some insurance companies will drop collision, and comprehensive coverage from your policy while others will allow you to maintain this coverage. The reason when this is dropped is to prevent someone to have a vehicle totaled a second time whether by hail or an accident. If you keep the coverage, then any future claim will be paid at a lesser amount unless the car is repaired.
If you have a question, comment, or experience you’d like to share, please share them with me on my Facebook, Google +, and LinkedIn pages. I’d love to hear from you!