Can I just keep cash from a car insurance payout and not fix my car?

Can you just keep the cash from a car insurance payout and not put it toward repairs? That really depends on whether or not you fully own your vehicle. If you don’t completely own your car, then the answer to this question will most likely be no: money awarded for repairs generally go directly to your repair shop.

If I own my car, can I keep the money from an insurance claim?

If you own your car outright, you can choose to not repair your vehicle for financial reasons, or delay repairs with the money you receive from an auto insurance payout. Simply put, you do not have to use any of the compensation you receive from an auto insurance company on repairs. That said, here’s a few things that you should consider before making this decision.

How much should I spend to fix my car?

First off, if your car has suffered major damage, most likely you’re going to need to fix it sooner rather than later. Even if you take your auto insurance payout and use it for something else, you’re still going to have to make the repairs eventually, so it might not make sense to wait. Also – and this should go without saying – if your vehicle is in any way unsafe, it’s wise to use your payout to fix the problem. And, if you do not fix your car, that amount of damage will likely reduce its value in future losses.

Another consideration is that sometimes if you do not make repairs immediately, your vehicle may end up incurring additional damage. That additional damage will almost certainly not be covered by your auto insurance because it was a direct result of your negligence in not using your initial payout to make the needed repairs.

Can I keep my car if it’s considered to be a total loss?

Finally, if your vehicle is deemed a total loss, you probably won’t be able to have your cake and eat it too. In order to receive your payout, in most states, your auto insurance company will possess your totaled car as a condition of its payout.

Unlike getting a few dents in your back door and deciding that you’d rather have the money than get those dents banged out at a body shop, if your car is deemed a total loss (even if perhaps you feel it is still road-worthy) you will not receive your payout unless you give up your car. There are a few states that will allow you to retain a salvaged vehicle if you pay the salvage value to the carrier, but you’d need to obtain a salvage or rebuilt title in that case.

Your insurance experts at Answer Financial recommend that in all cases, you should use the money from a car insurance payout wisely. If your car is in need of repair, it’s wise to fix it immediately to help keep others and yourself safe on the road.

Who is Answer Financial?

Answer Financial is one of the largest auto and home insurance agencies in the nation. We’ve insured more than 5 million homes and vehicles for people like you who are looking to find the right insurance for your needs and budget.

To compare side-by-side auto insurance quotes from top-rated insurers online, visit Or, call 1-800-258-5101 to have one of our license insurance experts walk you through your options, compare coverages and discounts and help you complete your purchase.


  1. mike scheier on September 27, 2016 at 12:03 pm

    I was rear ended last week. The person who hit me had insurance and their adjuster is telling me I must find a shop and they will only pay the shop and not make a cash settlement directly to me. The car is old and I am not sure I want to sink several thousand dollars into it. Can I demand a cash settlement here in California?

  2. Jerome on September 12, 2016 at 6:32 pm

    My insurance company sent me a check just in my name after they estimated my vehicle it was for $4,000…. I sent it to one shop they ended up estimating the damage after tear down that it was over $11,000 in damage…. the insurance company didn’t want to pay that out to that company because they didn’t work with that shop directory.. so the car was taken to a bigger shop that they work with they ended up estimated it to be a total loss… so they stated they were giving me $16.700.. for the vehicle but I have a lien holder because my car is financed…. but the big question is I had already cashed that $4,000 check that was made out directly to me. Do they deduct the money from that 16,700 or do I have to give that money back??

  3. Joyce on June 24, 2016 at 6:02 am

    We wrecked our car, turned in estimate to insurance company who took a while but we finally received money to fix from estimate turned in. they sent money direct to us can we take it to a different repair shop now, while waiting on them to pay out we found a place to do it cheaper

  4. david lafleur on May 8, 2016 at 4:19 am

    When your check from an insurance company is worth more than the amount to fix your car, who keeps the balance. You, the body shop, or split?

    • master cylinder on August 15, 2016 at 4:05 pm

      Remember when you asked your father for 5 dollars and all he had was a 10 dollar bill, well he might have told you to bring back his 5 dollars change but you never did and he did not expect you to either…..get my drift ?Negotiate your repair bill with your shop and have the check sent to yourself, what ever the repair shop receives they will spend it all and justify it later, just like you did with the 10 dollar bill.

      • Miguel on November 23, 2019 at 2:13 pm

        I am financing my car and have around 12,000 left to pay. A deer ran into my car and they estimated the damage to be $3,690. Once they send me the check do I have to repair the car or can I let that car go and use the money from the check to get another vehicle. I lost my good paying job so that’s why I’m considering letting this car go and using the money to get another one. Is it legally possible?

  5. Bill on June 6, 2015 at 12:19 am

    Your insurance will still do a payout if you keep your car. They will deduct salvage value off of your final check.

  6. Greg on May 29, 2014 at 12:55 pm

    I bought my Toyota new 12 years ago. Today 230,000 miles. I am the original owner. Hit and run driver rear-ended car and caused damage to the rear bumper, but car is drivable and very sound. My Insurance Company paid me $3000 under UMPD. Another $500 in damages and they would have had to Total car. Should I trade in my car to dealership and use the $3000 check as a down payment? NADA value is $3500 -$4000. The car will need a $1200 Catalytic Converter later this year to pass State emissions.

  7. wayne emerson on April 5, 2014 at 6:10 am

    Does this apply in nys

  8. Stephen Berry on March 20, 2014 at 11:33 am

    Does this apply to Utah? Also does it apply when its the other cars fault and there insurance is going to be the one to pay out. I want to use the money for the minimal body damage to repair the engine repair. (Engine is an unrelated issue)

  9. rob till on January 28, 2014 at 3:01 am

    I had a kitchen fire 3 years ago. I have 2 checks totaling over $27,000 to do repairs. Haven’t been able to leave home to go stay at motel for a month while repairs are done. Checks are issued to me and a repair company.(company came & did an inspection of home after fire)
    I sold the home in a quick sale,as is I am not going to do the repairs. Insurance company cancelled my home owners insurance after they paid the claim.Can I keep the checks since the repairs won’t be needed? Please advise. Thank you.

  10. patricia on July 21, 2013 at 7:03 pm

    Someon e hit my car while I was not in it. The scratches and dents are worth 2,500 . Can I keep the money and have it repaired another time?

  11. Sharon on March 6, 2012 at 11:33 am

    What if I keep the auto insurance payout money without repair. Later, my car is totaled with another accident,will insurance company have the right to deduct the first payout amount from the 2nd accident payout( if car is totaled)?



    • Chad Catacchio on March 6, 2012 at 4:59 pm

      In general, an insurance payout is based on returning your vehicle to the state it was in when an accident occurred. So if there is existing damage to the vehicle at the time of the accident, an adjuster will factor that into the claim. As always, the best source of information on specific claim issues is your insurance company and/or agent.