If you’ve looked around at car insurance lately, you’ve probably noticed that nearly every car insurance company now offers “accident forgiveness,” but they don’t provide a whole lot of detail about how it works. The basic premise of accident forgiveness is simple: it’s a feature you may be able to add to your policy that protects your premium should you be in an at-fault accident. Before adding this feature, though, be sure to understand how it really works and if it impacts your premium.
Here’s a list of pointers to help you make sense of accident forgiveness coverage.
- Each insurance carrier handles accident forgiveness in their own way. If you currently have this feature on your policy and are looking to switch carriers, talk to your prospective carriers so you can compare what you currently have to what you could be getting. Some insurance companies only consider your first at-fault accident eligible for accident forgiveness and any subsequent accidents will still impact your premium. Other carriers will only consider you for the program if your driving record is otherwise clean.
- Accident forgiveness isn’t always free. While it may prevent your rate from increasing in the event of an accident, there’s often a cost associated with adding it to your policy. You need to determine if adding accident forgiveness will increase your premium and, if so, whether it’s still the best option for you. Some carriers make enrollment in accident forgiveness automatic, while others allow you to opt-in.
- When your insurance carrier calculates your premium, they may still take prior accidents into account – even if you have accident forgiveness. Some carriers only consider future accidents as part of their accident forgiveness program. Ask your carrier – or potential carriers if you’re shopping for car insurance – how their accident forgiveness program works.
- Accident forgiveness doesn’t keep your driving record clean. While it may prevent your insurance premium from increasing, any at-fault accidents will still go on your driving record.
Accident forgiveness may be the best option for you, but make yourself aware of how exactly it will work and how it will impact your policy going forward. If you’re shopping for car insurance, be sure to ask potential carriers about their program, even if you currently have it.