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About Accident Forgiveness Plans

Most insurers no longer offer accident forgiveness in California. If they do, the insurance company will not raise your insurance rates if you have an at fault accident where there is a property damage only. Property damage is defined as to destruction to a vehicle or structure such as a home. If there is bodily injury or related medical costs, there is no forgiveness, the company will surcharge you. Several California companies offer one forgiveness per 5 year period, but I am not writing about them here because that could shortly change.

If you caused the accident and there were bodily injury or medical damages over a certain $ amount (usually $500) a surcharge is likely. How large the surcharge is depends on the severity of the damage and your insurer. Usually surcharges start at 10% and can go much higher.

If an accident is not your fault, accident forgiveness is not an issue.

Changing insurers is a way to lose your accident forgiveness and potential customer loyalty discounts. It might make sense to stay with your long time car insurer instead of switching insurance carriers every few years.

Without accident forgiveness, your insurance premiums would go up substantially for the next 3 years after an accident, the duration that the accident is on your driving record. But accident forgiveness is not a re occurring event, do not count on getting in multiple accidents without consequence. If some is hurt, or even claims they were hurt, resulting in bodily injury, there may be no accident forgiveness and you would not benefit from the companies good driver discount any longer.

So, yes they won’t put their own surcharge to your premium, but loosing this discount will still increase your rates. Remember, accident forgiveness is for one property damage accident only.

Accident forgiveness is not transferable from one company to another. If you change car insurers, any at fault accidents with your old insurer will be surcharged by the new carrier.

Accident forgiveness programs differ between insurance companies state law. Don't go with a copany just because they have an accident forgiveness program. Compare rates at the top via the yellow box. I recommend you use a smaller, semi known company.

Bous tip: I've done a lot of insurance shopping, and not just car insurance. Large carriers have more overhead and higher rates. It costs millions in branding and advertisign dollars to become a household name. There's nothing wrong with the smaller carriers that have chosen to keep rates low instead of branding.

Written by Craig J. Casey

Financial Writer helping people with their insurance problems on the net since 1998.

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