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Many popular auto insurance companies offer accident forgiveness, including Allstate, GEICO, Liberty Mutual and Progressive. The optional coverage, which may be purchased as an add-on or included in your policy automatically, can help keep an at-fault accident from causing your insurance premiums to spike. However, the programs and benefits can vary, and some insurance companies don't offer accident forgiveness at all or can't offer it in certain states.
What Is Accident Forgiveness?
Accident forgiveness can keep an accident from increasing in your auto insurance premiums. Generally, it applies to accidents you cause, which may be referred to as chargeable, surchargeable or at-fault accidents.
Without accident forgiveness, you may see your insurance premiums jump after an accident. The amount of this increase can depend on a variety of factors, such as your overall driving record and the claim amount. Ultimately, the premium increase caused by an at-fault accident could last for years and wind up costing thousands of dollars.
Getting accident forgiveness may seem like a no-brainer, but it's not always so simple. Companies may only offer the coverage to drivers who haven't been in an at-fault accident within the past three to five years, and some insurance companies offer it as a loyalty benefit to existing customers.
Insurance Providers That Offer Accident Forgiveness
Insurance companies may automatically include accident forgiveness in your policy, offer it as an optional add-on, or offer several tiers of accident forgiveness coverage that you can qualify for or purchase.
Where you live could also impact your options. Accident forgiveness isn't available in California, and some insurance companies don't offer the benefit to drivers in certain other states. However, popular auto insurers that offer some type of accident forgiveness include:
Review each policy carefully to understand what it does and doesn't, cover. For example, policies can vary by whether accident forgiveness applies to young drivers. And there may be exceptions, such as an accident forgiveness policy that only forgives accidents when the claim amount is below a certain threshold.
Another thing to keep in mind is that accident forgiveness might only prevent a rate increase from a single accident, and even if the accident qualifies for forgiveness, you'll need to pay your deductible if you're filing a claim. Once one accident has been forgiven, a second accident could then result in a rate increase. Additionally, the first accident will still appear on your driving record, which could lead other insurers to charge you higher rates. Accident forgiveness also won't prevent your premiums from increasing due to an accident disqualifying you from safe-driver discounts.
Is Accident Forgiveness Worth it?
Reviewing companies' accident forgiveness offerings can be an important part of choosing the right auto insurance policy.
Considering that the benefit could save you thousands of dollars, it may be worth getting quotes from several insurers that offer accident forgiveness if you—and everyone else the policy will cover—haven't been in an at-fault accident within the past three to five years. However, accident forgiveness won't be an option for everyone, nor is it always worth paying for.
For example, you may be better off paying less for a policy without accident forgiveness if you only drive the covered vehicle on rare occasions. Even if a policy automatically comes with the benefit, compare the total premium to other insurers' offerings to see if you'll wind up paying more for a policy with included accident forgiveness coverage.
On the other hand, you may frequently drive for work or to run family errands. Or, someone else on the policy may be a frequent or high-risk driver. In these cases, it may make sense to get a policy with accident forgiveness, even if it costs a little more each month.
Regularly Shop for Auto Insurance
Making a habit of getting auto insurance quotes is one personal finance practice that can lead to significant savings over time. If you're happy with your current insurer, consider the occasional check-in to review your policy to see if there are any new discounts you qualify for. You should alert your insurer to life changes, such as a reduction in the amount of driving you're doing, since that could also bring down your premium.
If it's been three or five years since your last accident, you may now qualify for a policy with accident forgiveness or get a discount for being a safe driver. Shopping for a new policy can be worthwhile even when that's not the case, as there are many ways to lower your auto insurance rates. Each company takes a unique approach in determining what to charge, so it's important to do your research.