Pros And Cons Of Accident Forgiveness

If you have been in a car accident and looking for a great way to lower down your rates, accident forgiveness might be your best solution.

What is accident forgiveness and how does it work? How about the perks and pitfalls?

Car accidents are cringe-worthy yet foreseeable in some case. Apart from dealing with the police, the other driver, hospital bill and medical costs, you will also worry about whether your insurance premium rates will increase or not. This is where accident forgiveness can be very beneficial. It aids you to maintain a lower insurance price over time—but is there a drawback to this car insurance policy benefit?

Accident forgiveness is a type of insurance offered by most auto insurance companies or insurers. It gives vehicle drivers an assurance that their car insurance price will not go up if they’re in an accident, whether it is a major damage or a minor injury. Often, accident forgiveness also applies to other family members including teenagers.

The details of the policy can greatly vary from one insurance company to another. Some offer accident forgiveness as an available additional coverage option for any client. Other companies only offer the policy after a motorist has been an accident-free policyholder for five years or more. Also, depending on the insurance company, the policy may only forgive one car accident every 3 or 6 years. You may be required to have had no moving violations for straight three years following the accident as well or have your rates go up.

Every insurer has restrictions on what situation the forgiveness will or will not apply as well as how/when they offer the feature. They create their own rules with regard to accident forgiveness, and it’s up to you to know what they are.

Before signing on for this form of insurance, talk with an independent car insurance agent who has in-depth experience and expertise about this matter to avoid mistakes or get compromised in the future. By opting for an independent insurance agent, you know they are working for you and will provide you with the best, unbiased advice.

RELATED ARTICLE: How Do I Lower My Car Insurance After An Accident?

Accident forgiveness offers numerous reasons why it is sought-after by motorists in different parts of the country. The benefits of accident forgiveness with your car insurance policy include:

• Doesn’t break the bank. Most accident forgiveness policies available won’t break the pocket and can be added to for less than $30 per month. Some car insurance companies offer it for no extra payment.
• Keeps premiums low. An excellent way to lower down your rates if you are involved in an accident.
• Used as an incentive. Car insurance companies may also use accident forgiveness as an incentive, which qualifies you for more coverage or better rates when you add it into your car insurance policy plan. Although, make sure to have a comprehensive discussion with your car insurance agent regarding what is best for you and your budget.

Though, accident forgiveness has a little share of drawbacks, too.

• Can be a waste of money. According to some reports, this type of car insurance is a waste of money because you are paying more money for auto coverage. It is like purchasing insurance for your car insurance.
• Have limitations. As we have mentioned earlier, you can protect yourself and your car from the accident but there may be limitations, such as how often you can “redeem” this protection or when you may be eligible for it.
• Possibility of dropping you as a customer after an accident. Beware of this. Regardless of how good your insurance policy and clean your driving record is, there’s still a possibility that your car insurance carrier will decide to drop you as a customer. This is true especially if the accident you’re involved makes you too high-risk for them to insure cost-effectively.

We consider it a tricky question because there is no way to determine the amount of insurance price that could increase if you were involved in a vehicle accident. Adjustments of rate after an accident vary and can change once in a while even from the same insurance company.

In order to find out if accident forgiveness is really fit for you, request your car insurance carrier to estimate the potential increase in your rates after an accident. Proper education is your armor. Look through insurance prices and make some comparison to narrow down your choices. When possible, consult with a professional independent car insurance agent from Magruder Agency to help you create a sensible decision.