The Fundamentals of Accident Forgiveness

Car accidents and higher auto insurance premiums almost always go hand-in-hand. When drivers file an accident claim, their insurer will usually reassess the driver’s accident risk and may apply a surcharge. To make matters worse, these claims are likely to stay on a person’s driving record for at least three years, making it difficult to get cheaper coverage from another company. In response to customer anxiety, many insurers have started offering “accident forgiveness” to loyal customers who meet the necessary requirements. The only catch is that these programs aren’t always what they seem.

​Availability of Accident Forgiveness

Popular online car insurance companies like Progressive, Allstate, and Nationwide all claim to offer lower rates through a system that agrees to “forgive” an accident to prevent rates from climbing after filing a claim. The problem, however, is that coverage providers cannot permanently erase an automobile accident; they can only choose to ignore the incident when calculating the driver’s premium. This means that receiving forgiveness from your insurer won’t do anything for a blemished driving record.

People are Taking Notice of Potential Pitfalls

Writer Jessica Bosari of Forbes warns motorists that these special offers may seem appealing, but in reality they may not offer very much in savings. She urges vehicle owners to be wary of insurance companies that throw around the word “forgiveness.” Although a policyholder’s premium may not be as affected by a collision after filing a claim, the fact that the motorist was involved in a collision is still relevant. Drivers may end up losing their good driver discount or become ineligible for certain savings that are contingent on keeping a clean driving record. Motorists should remember that forgiven doesn’t necessarily mean forgotten.
As these special offers become more popular, some state governments have started encouraging drivers to fully research a potential insurance provider before completely giving in to the idea of claim absolution. The Massachusetts Department of Consumer Affairs and Business Regulation reminds residents that not all programs are the same.
While some companies offer these savings freely without question, others may have fairly steep requirements that must be met before an incident can be ignored. Motorists with Nationwide, for example, need at least five years of driving experience without being involved an at-fault accident in order to become eligible for these savings.
One final point that drivers should remember is that these reduced rates may not carry over to another company. If a policyholder decides to switch insurance companies, they may be surprised to find that the previously forgotten accident on their record is suddenly the center of attention, potentially leading to higher rates.