This is the eternal dilema. You may get $1000 to fixi t, but will pay 800-2000 in higher rates. And sadly it is hard to predict the rate change, so you really don't know.
In the past I have done: Car < 5 years old fix it via insurance. Car > 5 years old, screw it I am driving a dented car. Thought about cash plan a few times, but never bothered for cosmetic stuff on clunkers.