What Is Accident Forgiveness?

Posted on Jan 7th, 03:45 pm, under Auto Insurance 101

With the economic recovery still in doubt, money is still tight for many people, especially for those who lost their jobs in the past year. The last thing you want is to get into an auto accident that will cost you thousands of dollars in damages and premium increases. This is why it's as good a time as any to check if you're eligible for accident forgiveness.

Accident forgiveness is a special feature that some auto insurance companies offer, and it's become a key selling point in recent years. Basically, what happens is that your insurance provider "forgives" you for your infraction, in addition to ignoring any adverse effect it may have had on your rates. This concept has been around for several years already, but it has steadily gained prominence in recent times.

Of course, in practice, the whole thing isn't that simple. The conditions for accident forgiveness depend on your particular insurance provider. State laws may also influence the cost and availability of this insurance feature. And lastly, even if your provider offers accident forgiveness to its customers, you don't automatically get it right from the beginning. You need to actually qualify for the benefit first.

Usually, insurance providers that offer accident forgiveness (like Allstate, for example) have a minimum requirement: 5 years of clean, accident-free driving. Several other requirements may be imposed as well, as stated above. 

With accident forgiveness becoming increasingly popular, you'll probably see it offered more often as an add-on to insurance policies. This feature can really save you a lot of money, if you're willing to invest in its benefits. By paying a little extra every month, you can protect your low rates from a potentially big increase, should you get into an accident. 

Some companies include accident forgiveness as an automatic addition to all policies that meet their standard, so you might want to re-read your contract to see if you've got it already. Other companies might even offer it as a free addition at no extra cost. Once again, the benefits vary from firm to firm, so ask your provider for more details.