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What Insurance doesn’t want you to know: Is My Car Worth Fixing After An Accident?

Where ti take your car after an accident
Is my Lexus worth fixing after an accident?

Many people ask “Can I take my car to the dealership after an accident?” and “How much does my car depreciate after an accident?” and ” Is it worth repairing my car after an accident?”

These are important questions with no exact answers but we will examine these questions and more in this post to help you navigate the difficult and unexpected situation that a car accident presents.

Should you take your car to a dealership after an accident?

Many people feel that the dealer is the best option for auto repair because they are “experts” with their particular brand. While if your car is less than a couple of years old, this may be that case , most cars are older than this and most quality body shops have the information and the experience to repair your vehicle just as well as the dealer and in some cases better. Most modern cars are built basically the same and it follows that repairs are basically the same.

If you feel it is important that the car be repaired by the dealer then by all means, skip to the next section. Did I mention that you could save money by going elsewhere?

Dealerships usually have the highest labor rates (cost per hour of work) and they can charge this because of perceived value. In a world where the insurance company picks up the tab for the entire repair, this is ok, but in today’s world of $500, $1000 and even $2500 deductibles, you have some choices.

Locally owned and operated body shops have some leeway when pricing a job and dealing with the insurance companies. That said it never hurts to ask something like “Can you help me with my deductible?” when negotiating a collision repair job.

If you have no collision insurance, your locally owned repair facility is ready to step up and give you the best deal possible on your repair job. Just be upfront and let the estimator know that the job will be out of pocket and you are getting a few estimates before committing and you will usually get their best deal.

If your vehicle is disabled at the site of the accident you, in most cases, can choose the wrecker service and body shop the car is to go to. If you don’t let the officer investigating the accident know your preference, your car will be picked up by the next towing service in line in the “rotation”. Most municipalities have a list of approved tow services and which ever company is next on that list gets your tow. Some are body shops and you can choose to have your vehicle repaired there but many are exclusively towing companies and an additional tow to your chosen shop will be required. That presents a new dilemma because now you can’t get a repair estimate from any other body shops and you will have to rely on the estimate that your insurance adjuster provides.

All this being said, it is best to establish a relationship of sorts with a preferred repair shop. That way when the almost inevitable fender bender occurs, you will be prepared.

Ask around your friends or ask on a social media post, then Google the candidates you are given and check reviews. Then call the ones that have good reviews and ask what the labor rate is. Take into account how you are treated on the phone and how far they are away from you and if they offer towing. You should be able to narrow down a short list of one or two. Then write them down with phone numbers and put that in your glove box. If you are in an accident, just pull that out and give it to the officer.

How much does my car depreciate after an accident?

According to the Bryant Law Center “If you are involved in a car accident, this number can get way lower. Following a car collision, your vehicle will depreciate 10% to 25% more than the average rate. Factors that can influence this depreciation percentage include the car’s age and its condition after the accident.” But let’s look into this a little further.

We have already found a reputable body shop to repair the vehicle so lets look at what you value you will lose after a collision repair.

If you are like me, You will drive a vehicle in excess of 200,000 miles. usually, after 100.000 miles, it is paid off and a lot of people drop, comprehensive and collision insurance which is ok if you can afford to replace the car if it is totaled. If you still have a loan on the car, you are required to keep “full” coverage by the lender. If you have no collision or a high deductible and the accident is deemed to be your fault, then you are going to pay out of pocket for at least some of the repairs. Normally, you would deduct this cost and say 20% from the Blue Book Value to get your cars after repair value but in todays tight used car market this doesn’t hold true and here is why:

At the time of this writing U.S. government data shows that used car prices have increased a whopping 40% in 2021 over 2020. With new car chip shortages still looming and used car supplies depleted, even cars with salvage titles are bringing premium prices. If you sell your repaired vehicle at a discount, it is unlikely that you will be able to replace it without coming up with a significant cash difference.

My advise is to check the blue book value but go a step further and look at comparable cars for sale in your local market. It is possible depending on the model, that a collision doesn’t currently devalue the car at all.

Is it worth repairing my car after an accident?

It is really up to you. I would say if you can get it repaired for half the value of the repaired vehicle, go for it. That formula will take into consideration mileage and sales in your zip. But be honest when entering information into the car value calculator because the only person you will be fooling is yourself. If your interior is shot and it needs paint all over, it is probably your best bet to cut your losses, take what you can get for it and buy something else. Even so, certain luxury models like Lexus and BMW and even Toyota (Especially Trucks) have almost a cult following so some of these cars can bring higher prices even wrecked.

All that being said, if the car will have a salvage title after it is repaired, it is important to verify with your insurance company what coverage you will be able to get. If you can’t get comprehensive insurance, you may not be able to keep a loan on the car. In which case, you will either have to pay off the loan or let the insurance company do it and take the car for salvage.

Get your used car buying guides here!

If you have any questions about this or any other automotive subject just ask in the comments.

Thanks, Monty

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