Accident Forgiveness: What Is It And Is It Worth It?

It doesn't matter if you're the best driver on the road or a newbie behind the wheel: accidents happen. That's why it's important to have the right insurance in place to protect you from financial and legal issues associated with accidents.

However, it's not uncommon for standard auto insurance policies to raise your insurance rates when you experience an accident. That's where accident forgiveness comes in handy. With this auto insurance policy feature, you don't have to worry about a hiked up insurance policy should you get in an accident. But it's also important to understand the ins and outs of accident forgiveness to discover if it's right for you. Here's what you should know:

What is Accident Forgiveness?

Accident Forgiveness is an added-value feature that insurance companies offer to keep your driving record from impacting how a car insurance company rates your risk level. It essentially is a way for auto insurance policies to ensure that your rates won't increase just because you cause an accident. Instead of penalizing you for having an accident, you can typically expect your auto insurance rates to remain the same. It's a way to save on your auto insurance and know what to expect when you pay your insurance bill.

The car insurance industry estimates that vehicle policyholders will make at least one accident claim every 17.9 years. So, it's not unlikely that you may make an accident claim. Moreover, the United States sees more than 6 million car accidents every year with over 7 million in 2016 alone. Thus, accident forgiveness may prove beneficial if you cause an accident.

The Pros and Cons of Accident Forgiveness

If you're deciding whether or not accident forgiveness is right for you, then it's beneficial to weigh its pros and cons. Here are a few factors to consider:

Pros

• You save on your auto insurance. One of the key advantages of getting accident forgiveness is that you save on insurance rates. Instead of your insurance premium increasing or incurring a penalty due to an accident, you can enjoy saving on the cost of your auto insurance bill. In some cases, this could potentially save you a rate increase on your premium of up to 41 percent.

• It's a safeguard for new drivers. If you're adding your teenager to your car insurance, then accident forgiveness may prove beneficial. Auto insurance companies typically consider teen drivers among the riskiest drivers since statistics show teens are three times more likely to get into a car accident compared to adults age 20 and older.

• Other drivers on your policy may also benefit. Some auto insurance policies also extend the benefit of accident forgiveness to other drivers on your auto insurance. That helps you save even more in the event anyone causes an accident.

• You'll have peace-of-mind. There is nothing like the comfort of knowing what to expect on your auto insurance bill when you caused an accident for the first time. Accident Forgiveness provides that cushion for keeping your bill consistent so you have peace-of-mind.

• You may get multiple opportunities for accident forgiveness. While several auto insurance companies offer accident forgiveness as a one-time deal, some "rewind" the counter and allow other opportunities for accident forgiveness, such as every three or six years. However, some auto insurance companies require that you have no other driving violations in order to get accident forgiveness again while others don't. So, it's important to double-check with your insurance company about this option.

Cons

• It doesn't work for every at-fault accident. While most accidents may be forgiven, accident forgiveness does not apply to all accidents. For instance, you can typically expect the policy feature to apply to first-time accidents. Any at-fault accidents beyond that may not be applicable for accident forgiveness. Thus, it's important to review the insurance company's policy regarding which accidents qualify for forgiveness.

• It's not available on every insurance. You may find that the major players of the auto insurance industry offer accident forgiveness. However, it's important to know that not all auto insurance policies or companies offer it as a feature.

• You may not qualify. Even if your auto insurance allow you to add accident forgiveness to your auto insurance policy, it's possible you won't be able to get it if you have prior violations. For instance, too many moving violations or having an accident within the last three years may disqualify you from being eligible for accident forgiveness. Thus, it's always important to review the requirements of your insurance company for qualifying for accident forgiveness.

• It's an extra cost if you don't use it. If you are a relatively safe driver with a clean driving record, accident forgiveness may not be ideal. You often pay extra for this added feature, which can end up costing you more over time if you never use it. For instance, if you know you are only leasing a vehicle for three years while on a temporary job assignment and you have a clean driving record, then accident forgiveness may not be ideal. So, it's important to assess your personal situation and needs to determine if accident forgiveness is right for you.

Final Thoughts

With your chances of getting in an accident, accident forgiveness is an important feature to consider adding on to your auto insurance policy. But it's also crucial to determine if it is right for you. Weigh the advantages and disadvantages of accident forgiveness. Also, consider using a platform that makes it easy to find auto insurance policies that offer accident forgiveness. By taking these steps, you can decide if accident forgiveness is right for you.