“Forgive and forget.” It’s a timeless phrase that has a lot of useful applications in our modern world. It’s a saying to live by, as a way of removing stress and living our lives to the fullest. It is also something that car insurance companies take literally. Well, at least the “forgive” aspect; the “forget” part is a little more tricky.

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What Is Accident Forgiveness?

Usually when a policyholder gets into an at-fault accident and files a claim, his or her car insurance premiums will rise. And this increase is not insignificant; it can be as much as 30% to 40% from the base rate. Not only that, but these elevated rates can remain in effect for up to two years.

Accident forgiveness is essentially a mulligan, a “do over.” What does this mean? Well, it’s like the accident never happened, as far as your auto insurance premiums are concerned. The auto insurance company will not increase your rates, no matter how much the claim is for. In this sense, the accident is “forgiven” and the policyholder will not be penalized.

Accident forgiveness is an extra feature placed on an auto insurance policy. Of course, “extras” cost extra money. But if you compare the cost of this feature versus how much you would pay in additional premium amounts if you were to get into an accident, the difference is staggering. One can expect to pay $50 a year for this feature. If you get into an accident, you could pay an extra couple thousand of dollars in premiums over the course of two years.

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How Can You Get Accident Forgiveness?

A policyholder must meet a series of requirements in order to be able to purchase this feature. What these requirements are vary among auto insurance companies and also depend on the state the policyholder resides. Typically, insurance companies require that a policyholder be insured under them for anywhere from three to five years. Also, the insurers stipulate that the policyholder remain accident free for a period of around five years.

It is also worth noting that this accident forgiveness only applies to the first at-fault accident. If the policyholder is involved in another at-fault collision, he or she will face the typical premium rate increases. In essence, the first accident is “forgiven” but not “forgotten.” However, for many motorists, only forgiving the first at-fault crash can mean some worthwhile savings.

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