This is a complicated question that unfortunately has no simple answer. The fundamental thing to understand is that the existing damage to your car has a value and the insurance company will deduct that value from any claims that it might face.
Let’s say you have hail dents on the trunk and rear bumper and a car comes along and hits you in the rear. Because the trunk and bumper cover were already devalued from hail damage, the insurance company won’t pay to replace or repair them. However, they will cover any non-hail damage, such as the crushed crumple zones beneath the bumper cover.
It’s true that a car with cosmetic damage can save you a bundle on the cost of the car, but you must be willing to accept the fact that you might need to pay out of pocket for repairs if an accident happens after you buy the car. This could also have a huge impact if there is a total loss. For instance, if the car is stolen, you would be covered for the actual cash value of the car. If the hail damage caused the car to be a total loss before, the car is only worth salvage value now…usually a few hundred dollars at best.
When you buy a car that was a previous total loss, you are essentially buying a car without cash value. That means you are better off pocketing the extra cost of collision and theft insurance to save for the rainy day when you will need to buy a replacement. If you buy such a car, buy it with the assumption that you will have to buy another used car in the next five years or so. If you couldn’t afford to buy another car, you probably can’t afford that hail-damaged car. The sticker price might be low, but there is a hidden cost.
