Accident Forgiveness Car Insurance

Do insurance companies really forgive and forget?

What's accident forgiveness coverage?


If you’ve ever been in an accident before, you understand there are often some pretty serious financial consequences — especially if the accident is your fault. In fact, in 2017, an at-fault accident raised insurance rates an average of $582! With jumps in prices that high, the idea of having accident forgiveness coverage can be quite tempting. 

But what does "accident forgiveness" really mean? The answer can get pretty complicated — and we'll sort through it in just a second — but for now, the short answer: it depends on who you’re insured by. Let’s explore the idea of accident forgiveness across some major insurance companies.


  1. What is accident forgiveness?
  2. What are some popular companies?
  3. Is it worth it?




Basic idea


In plain english, accident forgiveness means your auto insurer won't raise rate after your first accident. However, this is a very vague way to describe accident forgiveness coverage as it relates to your insurance rates and your relationship with your insurance company.

You should note, however, that accident forgiveness refers to at-fault accidents. Comprehensive claims wouldn't into this category but a collision-type claim would as these are chargable accidents.





Popular Companies


Although these insurers advertise accident forgiveness car insurance, not everyone who applies will qualify for the program. This not only has to do with individual qualifications but also your location. Some states, notably California, do not participate in these types of programs. Regardless, here's a general comparison of accident forgiveness programs across the major auto insurance companies.



Liberty Mutual

Liberty Mutual’s accident forgiveness policy works similarly to the core concept. If you're accident-free for five years (with any company), the company will forgive your first accident and not raise your rates. Furthermore, this policy can apply to all members of the household, including teenagers. However, it's still one forgiven claim per household and not per driver.

This coverage is not available in California.



Nationwide

Nationwide's accident forgiveness program is an additional cost to your premium which, like the others, forgives your first at-fault auto accident on the policy. Nationwide also couples another discount to the policy, which is often referred to as a safe driving discount, in which you would receive an additional 10% discount if you're accident-free for five years.


Geico

Geico’s accident forgiveness is slightly unique, in addition to following the same general program outline as other companies. Basically, Geico will forgive your first auto accident caused by anyone on the policy and can either be earned or purchased. In order to earn accident forgiveness, you need to be over 21 and have been accident-free for five years.

This coverage is not available in California, Connecticut, and Massachusetts.


Progressive


Progressive's accident forgiveness program is a tiered loyalty program. Meaning, while you don't pay extra for it, you have to be insured and accident-free record with Progressive for a certain period of time in order to qualify. So, even if you've been accident-free for decades, you would not immediately qualify for Progressive if you're newly insured by them. The tiers are determined based on how long you have been accident-free (3 years versus 5 years) and how "big" of an accident they are willing to forgive (small accident or larger).



Allstate

Allstate’s accident forgiveness works a bit differently than some of the other policies. Basically, if you want to qualify for accident forgiveness, you have to pay for it through a Gold or Platinum coverage plan. Together these plans are known as the YourChoice Auto plan. For a gold plan, you need to go three years without an accident in order to be eligible for accident forgiveness. On the platinum plan, your accident forgiveness begins immediately.

This coverage is not available in California.



Eerie


Eerie insurance has a couple of different options for accident forgiveness coverage. Their first and more standard coverage, First Accident Forgiveness, follows the same concept as other companies: the first accident isn't chargeable. Their second feature, called Feature 15, refers to a loyalty program that forgiveness all at-fault auto accidents if you are with Eerie for 15 years. They do not specify if you need to be claim free for these 15 years in order to qualify, so you would need to speak with your agent to see if you are eligible.



Travelers


Travelers insurance offers an auto accident and minor violation forgiveness for a fee. Both forgive one accident/violation every 3 years. In terms of the monetary cost of a "violation," it is not clear if they are referring to driving without your lights on (about $50 per year), speeding (depends on how much you are speeding) or a DUI ($1,168 a year increase). So, if you're with Travelers, you should ask your accident exactly what kind of violation they are referring to.





Is it worth it?


Deciding on whether or not to purchase accident forgiveness coverage and which insurer to use are some seriously difficult choices. You'd want it if you need it, but is the price worth the payout? Here are some other questions you should ask yourself before making a decision:


  • How likely are you or someone on your policy to be in an at-fault accident or file a claim?
  • Does the coverage apply to everyone on the policy? Especially any vulnerable drivers?
  • Is the additional premium of this coverage less than the increased rate of an at-fault accident?

If your head is spinning even faster after those questions, don't panic just yet. We're going to walk you through everything you should consider.

In terms of the first question, you should consider how risky of a driver you or anyone on your policy are. Because, as we discussed, these policies can apply to all members of your household, including teen drivers. So, if you’re worried about your teen driver being a teen driver, consider this policy. If, however, you’ve never had an accident in your adult lifetime and have a clean claims record, you might not need this coverage if you have to pay an additional premium.

Regardless of this next question, you should always read the fine print of your policy to check to see if there are any hidden caveats. If you're wanting this coverage especially for your teenage son but teenagers are excluded, then you probably don't want this package. Other exclusions might be all drivers need to be accident-free for 3-5 years in order to qualify. In this case, a newly licensed driver might have trouble getting this coverage. As they might not have a driving record longer than a few months.

The last question is a little harder to answer in exact amounts. The amount you’d pay for an at-fault accident depends on many variables. But, on average, you can expect to pay $291 more per 6 months for an at-fault accident. Considering that you’ll be charged for 3 years for most at-fault accidents, you’ll be charged $1,746 in addition to whatever your premium is for your accident.


Increase at 6 months Increase at 12 months Increase at 3 Years
$291 $582 $1,746


So, if you’re worried about the likelihood of having an at-fault accident and that scary $1,700 chargeable premium, consider if accident forgiveness is worth it. While we can’t give you an exact amount of how much this coverage will raise your premium, a licensed agent for your insurance company should be able to quickly quote you the exact increased amount.


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