Yes, that is one of the downfalls to not using an insurance check for the repairs it was intended to pay for, the damages are still on the vehicle and thus can reduce the settlement of a future claim.

Your insurance company is now able to deduct the amount of the pre-existing hail damage from their calculation of how much the actual cash value of the vehicle is. They know the exact cost of the hail damage since they previously cut you a check for it to be repaired.

Since your car is being declared a total loss, then your insurer is again correct that if you want to keep the car you would need to pay them the cost of salvage value. Usually this is deducted from your settlement amount, in your case you would need to see if the amount you are left over after the deduction of the hail damage and the deductible are taken into account to see if there is enough left over to buy back the car. Keep in mind if you do buy it back it would now have a salvage title, which may be difficult to find auto insurance for.

If you want to carry full coverage, meaning liability plus collision and comprehensive coverages, is a personal choice. Many people do take off collision and comprehensive coverages once they own the car in the clear and if the vehicle is so old that the cost of keeping "full coverage" on it does not make sense financially due to the car's actual cash value being low.

To find out about your specific insurance rights in your state you can contact the consumer division of your state's insurance regulator.