Re-invest and/or re-fund when/if you happen to get one.
I was reimbursed for the expense of some dental work for my son. It was quick and painless (wish I could say that about the actual dental work).
Anyway, rather than cash it and put it back in my weekly budget, I’ll keep it and put it in my teenie tiny RRSP. Compound interest kills you when you’re in debt – but it can work for you when you save. So I’ll save a bit to help counter the balance. $250 now dollars can be $1,000 later dollars. So I’ll keep those ones for later. Unless we have another emergency visit to the dentist.
Don’t forget to floss. It saves money too.