Accident forgiveness is a feature offered by some auto insurance companies that may sound like a safety net for frequent accidents, but it comes with limitations. Generally, accident forgiveness applies to one accident every three to five years, not multiple claims in a short span. This feature prevents your insurance rates from rising after a single accident, which can be helpful in keeping costs stable if you’re involved in an incident.
It’s important to know that accident forgiveness is often included as part of an enhanced insurance package, such as a premium or elite-level plan. These plans typically come at a higher monthly rate, with the understanding that should an accident occur, your rates won’t automatically increase as they might with a standard plan. However, if you go without an accident, you may end up paying more overall simply for the added peace of mind.
When considering accident forgiveness, weigh the added cost against the likelihood of needing it. While it can offer some financial reassurance, this feature may only make sense if it aligns with your driving history and risk tolerance. In the long run, you might be paying extra for coverage you don’t end up using, so it’s worth evaluating if the added premium fits your needs.
Our owner and founder, Pat Brennan, explains more. Check out the video below!
What Is Accident Forgiveness? – Entrust Insurance, St. Clair Shores
Video Transcription
“So there’s some things that you need to understand about accident forgiveness. If you take it at face value, that’s not what it is. So you can’t get into two, three, four accidents and have them freeze your rate because of that. So, usually there’s a certain number of claims over a time period that they’ll forgive, and typically it’s one every three years or one accident every five years. The more important thing to understand is, is that if that’s offered through an insurance company, typically that’s part of their better, best elite type of insurance package that you purchase. Now you are paying more money, which means every month you’re paying could be 3%, 5%, 10 percent more than the standard package. But if you have no accidents, what you’ve done is you’ve actually paid more money than you rightfully should over time.”
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