Does damage already paid through an insurance claim need to be completed if home is going to foreclosure?

My best friend is letting her home go to foreclosure due to extenuating circumstances. She had water damage in April and the insurance company is going to pay her out this week on the damage (00). The repairs have not been completed and since she is letting the house go to foreclosure, she is contemplating getting the repairs done at all and pocketing the money. Are there repercussions for this? She is afraid of getting accused of insurance fraud. Should she do the minimal drywall work just to make it presentable? Will her claims impact her ability to get renter’s insurance for her new residence? Thank you for your help!

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