Alexander Pope once said to err is human: to forgive, divine. When it comes to insurance companies and accident forgiveness, I’m not sure we would go that far, but for some, it might be an inspired idea.
We’ve all seen the commercials about an insured whose first accident resulted in a premium hike, or perhaps you’ve even experienced it firsthand. While your insurance agent can’t undo the damage to your vehicle, they may be able to make the incident less painful.
How is my driving record determined?
All Bright Insurance/Jensen Sheehan company partners offer some version of accident or merit forgiveness. To understand how it works, you need to understand a little something about the Massachusetts Registry and the Safe Driver Insurance Plan (SDIP). Here is an overview, in the simplest of terms. If you have been licensed in Massachusetts for over five years and have been accident free for the last six years you will be rated as a 99; which is considered a perfect driving record. Most insurance companies will give you a discount for being a “safe driver”. If you receive a violation you lose your “good driver” status and become a 00 which is neutral, meaning no discount, but no surcharge either. An accident or other violation will start adding points to your record which then will result in a surcharge. For calculating your premium, insurance companies vary on the number of years they check your driving record, but barring any other incidents you will be back to a 99 in the registry after six years.
Most insurance companies who offer accident forgiveness offer it as an additional endorsement, which means additional premium on your policy. For some companies, it is a flat charge per the policy and for others a percentage of the entire policy premium. In addition to this, most companies have a driving record criteria you must meet to be eligible. For some, you must be a SDIP 99; others will offer it even if you have points on your record.
What this means for you:
If you have accident forgiveness on your policy and you have an accident, you will not see the large increase in premium you would see if you didn’t have it. Bear in mind this also affects the following years where the surcharge would be applied. While there is a chance, you could purchase accident forgiveness and never need it, if you are in an accident it could save you hundreds of dollars over the life of your policy.
If you have other questions about accident forgiveness and whether it is right for you, please call us and we can discuss the specifics of what your company offers.