Accident Forgiveness: Everything You Need To Know in 2022

Accident forgiveness is an optional add-on to an auto insurance policy that prevents your rates from increasing after your first at-fault car accident. To qualify, drivers generally need to maintain a clean driving record free from accidents and traffic violations — typically three to five years. Although accident forgiveness may be an additional cost, it can help offset the costs of paying higher insurance premiums for several years.

Keep reading to learn how accident forgiveness works, how to qualify and which insurers offer it.

On This Page

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  What Is Accident Forgiveness?

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  How Does Accident Forgiveness Work?

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  How Much Does Accident Forgiveness Cost?

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  Who Is Accident Forgiveness Best For?

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  Is Accident Forgiveness Worth It?

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  How Do I Know If I Have Accident Forgiveness on My Car Insurance Policy?

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  Which Car Insurance Providers Have Accident Forgiveness Programs?

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  Accident Forgiveness Alternatives

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  FAQs

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  Methodology

What Is Accident Forgiveness?

Adding accident forgiveness to your auto policy will keep your auto insurance premiums from increasing after your first at-fault car accident. The rate increase is called a premium surcharge or accident surcharge and typically goes into effect when you renew your policy. Having accident forgiveness waives this surcharge, helping you save on car insurance after an accident.

Accident forgiveness is typically an optional policy endorsement you must purchase. However, some insurers will offer it as a free reward to loyal customers with clean driving records that join the company’s loyalty or rewards program.

Accident forgiveness coverage typically applies only to your first at-fault auto accident, but there are some exceptions. Generally, a premium surcharge applies after you use the accident forgiveness benefit. However, some insurers will allow you to “renew” the benefit after maintaining a clean driving record for several years.

Adding accident forgiveness to your auto policy will keep your auto insurance premiums from increasing after your first at-fault car accident.

How To Qualify

Accident forgiveness is available from most national insurance carriers and the eligibility criteria will vary by company. Generally, drivers will need to meet some or all of the following conditions:

• No at-fault accidents within the past three to five years
• No moving violations within the past three to five years
• Fall below a certain age
• Remain with the same company for several years
• Clean driving records for every household member

How Does Accident Forgiveness Work?

Take the following steps to add accident forgiveness to your policy and apply it after an at-fault accident:

• Add accident forgiveness to your policy: Ask your insurance agent if accident forgiveness insurance is available and how to qualify. If you meet the requirements, you can purchase accident forgiveness as an add-on to your auto policy.
• Follow the usual claims process: The steps for filing a claim will remain the same after experiencing a car accident. Remember to exchange insurance information with the other driver, document the accident scene and contact your insurance company as soon as possible. If you have roadside assistance in your policy, you can arrange a tow if necessary.
• Settle the claim: If you’re determined to be the at-fault driver, you will be liable for the other driver’s losses, including property damages and medical bills. Your injuries are covered if you have Medpay/PIP coverage and collision coverage for your property damages.
• Use the accident forgiveness benefit: Your insurer will forgive your accident, and you won’t incur an accident surcharge. Depending on your insurer, you may be able to renew the benefit after maintaining a clean driving record for several years.

Accident forgiveness is typically an optional policy endorsement you must purchase.

Accident forgiveness may apply to only one driver per policy. If another driver listed in your policy — your spouse or child, for instance — exhausts the benefit in an at-fault accident, it may no longer apply to the next accident another driver experiences. Confirm with your insurer if your accident forgiveness benefit applies once per household or to each driver.

How Much Does Accident Forgiveness Cost?

Accident forgiveness can cost $100 per year ($8.33 per month) according to Lemonade Insurance. This may seem like a moderate cost but can be worth it, considering that an at-fault accident can increase your car insurance by 44%. For the cost of one takeout meal per month, you can save hundreds of dollars in car insurance.

Example: Your auto insurance policy costs $1,403, the average cost of full coverage on a medium sedan, and you do not have accident forgiveness. After getting into an at-fault accident, your car insurance increases to $2,020.32 (+44%) — money that could have stayed in your bank account if you had accident forgiveness.

Who Is Accident Forgiveness Best For?

Accident forgiveness is generally ideal for younger drivers for three reasons:

• Young drivers are generally inexperienced and more likely to get into a car accident.
• Younger drivers are generally charged higher rates, and an accident surcharge can be considerable.
• Some accident forgiveness programs have an age cap.

Is Accident Forgiveness Worth It?

Benefits of Accident Forgiveness Insurance

• Affordable: Accident forgiveness can potentially cost about $10 per month — the price of a monthly Netflix subscription. Prices will vary by company and location.
• Avoid paying higher premiums: An at-fault accident will almost certainly increase your insurance rates unless you have accident forgiveness. Without this benefit, you risk increasing your insurance rates by up to 44% for three to five years. This increase can remain in effect for three to five years.
• Peace of mind: Even as a safe driver, accidents happen. Having accident forgiveness in your policy can help you drive with more confidence, knowing you are prepared when the unexpected happens.
• Free for safe-driving and loyal customers: Your insurance company may offer accident forgiveness as a free benefit if you drive safely and continue renewing your policy with them. Some insurers may also require you join their rewards and loyalty program to qualify.

Some insurers offer accident forgiveness as a free reward to loyal customers with clean driving records.

Drawbacks of Accident Forgiveness

• Some insurers may have an age cap: Insurers may only allow younger drivers to enroll in accident forgiveness. For example, only drivers ages 25 and under may qualify for accident forgiveness. Younger and inexperienced drivers are statistically more likely to experience a crash, but accidents can happen even when you’re older.

• May not be available in all states: Like many types of endorsements, accident forgiveness may not be available in all states. Availability will vary by insurance company and you should consult your insurance agent if this add-on is available in your area.
• Entire household may need to qualify: Some insurers raise the bar and require each listed driver in the policy to meet the eligibility criteria. This can be especially challenging if you’re a safe driver but have accident-prone drivers in your household.

How Do I Know If I Have Accident Forgiveness on My Car Insurance Policy?

There are two common ways to confirm if you already have accident forgiveness on your car insurance policy:

• Ask your insurance agent: A representative can look up your information with your policy number to confirm which coverages you have.
• Review your policy yourself: Go through your physical insurance records and search if accident forgiveness is a listed benefit. If you’re unable to find the physical record, you can log into your online portals or access the mobile app, if available with your insurance provider.

Which Car Insurance Providers Have Accident Forgiveness Programs?

Several national carriers offer accident forgiveness programs and typically require a clean driving record spanning three to five years.

Accident forgiveness is generally ideal for younger drivers.

Accident Forgiveness Alternatives

The following benefits are cost-saving alternatives to purchasing accident forgiveness. Although, some of the benefits, like deductible rewards and telematics, may be useful benefits to add alongside accident forgiveness.

• Deductible rewards: Your insurance company may decrease your collision deductible when you maintain an accident-free record.

• Enroll in telematics: Your insurance company will grant a policy discount based on how safe you drive. This benefit will require you to join the company’s telematics program and agree to surrender your driving data.

• Rate lock: This benefit will lock in your rate while the benefit is active, preventing price increases from inflation, getting into an accident, committing a traffic violation and more.

• Minor violation forgiveness: Your rate won’t increase if you are cited for a minor traffic offense, like failing to signal when changing lanes or following a vehicle too closely.

Find an affordable auto policy that includes accident forgiveness. SmartFinancial’s free online tools analyze carriers in your area to find a policy that matches your coverage needs and budget. Just enter your zip code below or call 855.214.2291 to receive your free auto homeowners insurance quotes.

Methodology

Accident forgiveness eligibility criteria were provided publicly posted by the insurance companies. When requirements were not disclosed, we obtained the information from insurance agents that serve Florida.