If you are a driver in America, then you have had to shop for car insurance at some point in your life. With so many different companies and policy types out there it can be easy to get overwhelmed, or fall for basic marketing tactics. One of the most common questions we get about car insurance is always, “Does this policy include accident forgiveness?”. Is accident forgiveness something everyone should have on their policy? Does an accident forgiveness clause actually save you money, or are you paying for a placebo effect? Let’s take a closer look at what exactly accident forgiveness means, and whether it is worth your time.
When you first hear the term accident forgiveness, you probably took it at face value: a clause in an insurance policy that ensures that your premiums do not go up if you get into a car accident. The assumption there is that accident forgiveness is a clause that saves you money if you get into an accident. That is where the premise is flawed. Yes, it is possible for an accident forgiveness clause to save you money. No, it probably will never actually do so.
The key here is to consider the cost of premium increase compared to the more expensive policy that includes an accident forgiveness clause. Every policy is different, most that include accident forgiveness cost up to 9% more than a policy without that clause. While that may not seem like a lot, that increased cost can add up year over year. Comparatively, if you cause an accident your rates can go up by as much as 45%.
So yes, if you are accident prone an insurance policy that includes accident forgiveness can be a good investment. However, if you find yourself going years without accidents, it may be best to take your chances and opt for a cheaper insurance policy that does include accident forgiveness.
It is worth reiterating that insurance policies differ greatly from person to person, and state to state. When it comes to car insurance many people will opt for the bare minimum coverage, while others are more comfortable paying more every month for increased protection in case something happens.
If you are already paying a lot per month, adding accident forgiveness might not make short-term financial sense for you. Conversely, if you premiums are low, adding accident protection could be a decision that saves you a lot of money.
The long and short of it is that there is no right answer that applies to everyone. As a responsible insurance customer it is worth doing your research and taking the time to do the math. Take an honest look at your driving record and find out the average amount of time between car accidents for you. If you find yourself getting into an accident one or more times a year, it is likely going to be worth your time to learn more about getting a policy with accident forgiveness.
If you would like to learn more about your current car insurance policy, or inquire about a new one, you should check out TGS Insurance. The TGS Insurance staff are experts in car insurance, and are always happy to talk you through the policy that fits your specific needs. Visit www.tgsinsurance.com to learn more.