How to cash auto insurance claims checks?

The procedure of cashing out a check may vary from one company to another and if you are cashing out a check you may call the issuing company to ask what their requirement is to cash the settlement check.

Here are few steps you may follow:

• You may call your lien holder or the bank and let them know that you have received the check for insurance settlement and that it is payable to the policy holder and the company.
• Get your check endorsed and ask the company to endorse their check too. You can find out from the lien holder which department you need to send their check to. After getting it endorsed the company will send back the check to you. If there are any other payees on the check they must get the check endorsed too, even if it is your spouse.
• After the lien holder and other related people have endorsed the check you must deposit it in your bank account.
• Wait for clearance and then you may issue your personal check to your lien holder who you owe money. It may be your auto repair shop or the contractor who has got your home repaired or any other related person or company.
• If your check amount is large some banks may require you to produce a report for insurance loss and also the bid placed by a contractor or a body shop for which you need to make the payment.

Not if the check is in your name and the lien holder's. But if the insurance company has put the check in the name of the lien holder you might have a little difficulty in getting the balance amount back. They might give you a proposal to get the car repaired and use up the balance amount you think you deserve. If this is the case, you may contact them and ask them what procedure they follow after you have endorsed a check and mail it to them.

If your car is repoed, you may contact the lender and try to negotiate a payment option. Repossessing your car is not the best option for your lender since they lose out thousands of dollars doing this. So, usually they would like to work out a payment plan with you and try to prevent their loss.

When you sign an agreement document with your lender you must first go through the terms mentioned in the document. It is supposed to have rights you possess in case you default on a payment or if your car is repossessed. Make sure you know your rights and be aware to not be fooled in to any action taken against you that is not legal.