Accident Forgiveness

Accident forgiveness is when an insurance company agrees not to factor a car accident into calculating your premiums.

What is accident forgiveness?

Accident forgiveness is when insurers forgive your first at-fault accident. Hey, nobody’s perfect, and driving on the open road can be unpredictable. If you have an insurance policy with accident forgiveness coverage, your insurer won’t increase your insurance rates after your first accident. Keep in mind that accident forgiveness programs are usually very specific to each insurer, and often include eligibility requirements, like a 5-year clean driving record.

Of course, getting in a car accident typically does increase your car insurance premiums. Your car insurance company calculates premiums based on your driving record, the make and model of your car, annual miles driven, and other risk factors. If you have a clean driving record, you pay less for your auto insurance policy. 
If you’ve previously been a good driver, and maintained an accident-free record, congratulations! It’s cool to be safe. As a bonus, your insurer might offer accident forgiveness coverage. It helps them keep your business and allows you to keep good driver discounts, even in the event of a one-off accident .

How does accident forgiveness work? 

Accident forgiveness is an add-on to some car insurance policies. If you have a clean driving record, check with your insurer to determine your eligibility. Adding it to your car insurance coverage means that you won’t have to deal with a rate increase on top of a car accident.

Who is eligible for accident forgiveness? 

Most insurance companies have the following eligibility requirements:

• Accident-free for the last five years, even if you were with another insurer
• No moving violations in the last five years
• If you’re under 25, you need five consecutive years with a clean driving record before the insurer forgives your first accident

If you’re a high-risk driver with multiple moving violations or a DUI in your driving history, you probably won’t be eligible for accident forgiveness coverage.  

How much does accident forgiveness insurance cost? 

Anytime you add a coverage option to your car insurance policy, expect to see your premium increase. But if you’ve been a loyal policyholder, sometimes insurers offer it for free as a perk. 

Provided you’re eligible—meaning that you’re a good driver with a clean driving history—adding accident forgiveness coverage may cost as much as $100 a year. But that additional surcharge could save you hundreds of dollars in the long-run by allowing you to keep your safe driving record if you happen to get into a single accident. 

It’s a small price to pay for some serious peace of mind. The national average for premium increases as a result of an at-fault accident is between 34 to 44%. That’s a hefty penalty for one mistake in an otherwise impeccable driving history. 

Is accident forgiveness coverage similar in every state?

Accident forgiveness coverage isn’t available nationwide (so if you live in California, Connecticut, or Massachusetts you shouldn’t expect your car insurance company to offer it). Drivers who qualify for accident forgiveness are picked based on state-specific rules that determine whether or not they are a “good driver.” There is a lot of variation in what states permit, so as always: Read your policy carefully. And if you’re in the process of getting an auto insurance quote, just ask if this is a coverage option. 

A few quick words, because we <3 our lawyers: This post is general in nature, and any statement in it doesn’t alter the terms, conditions, exclusions, or limitations of policies issued by Lemonade, which differ according to your state of residence. You’re encouraged to discuss your specific circumstances with your own professional advisors. The purpose of this post is merely to provide you with info and insights you can use to make such discussions more productive! Naturally, all comments by, or references to, third parties represent their own views, and Lemonade assumes no responsibility for them. Coverage and discounts may not be available in all states.