Even the safest drivers can encounter an unexpected accident on the road. While road fatalities in Ontario have decreased by roughly 700 from 2003 to 2022, accidents are still in the 100,000s range. In Ontario, where car insurance is mandatory, one at-fault collision can increase your premiums.
However, an add-on called “accident forgiveness” can protect your wallet from spikes. Learn how accident forgiveness works, the conditions for eligibility, and what limitations to know.
What is Accident Forgiveness and What Does it Cover?
In Ontario, accident forgiveness on your car insurance applies explicitly to preventing an increase in your premium after your first at-fault accident. Thus, if you have accident forgiveness and cause an accident, your insurance company won’t increase your rates, allowing you to maintain your current premium.
However, if you have subsequent at-fault accidents, expect your premium to rise, especially for severe violations like impaired driving.
Conditions and Limitations of Accident Forgiveness in Ontario
Accident forgiveness in Ontario offers some peace of mind, but it’s not a free pass. For instance, accident forgiveness won’t cover the following:
- Subsequent accidents where you are at fault
- Demerit points
- Major violations like DUIs or reckless driving
- Secondary drivers
Limitations of Coverage
Not only does accident forgiveness impose limited coverage—here are other conditions you should know:
Who is a Good Candidate for Accident Forgiveness?
You understand how accident forgiveness works, but are you a good candidate for it? Accident forgiveness may benefit you under the following circumstances:
- You’re a conscientious driver, but acknowledge the possibility of an accidental mishap.
- You’re an inexperienced driver who may be more prone to accidents.
- You participate in activities that occasionally increase your risk profile, such as renting high-performance cars.
- You drive frequently for work and are more statistically likely to experience an accident.
- You live in a dangerous city for driving.
- You drive an accident-prone car model.
How to Qualify for Accident Forgiveness
Accident forgiveness can be valuable for maintaining stable car insurance premiums in Ontario, but you must qualify. Here are the eligibility criteria for accident forgiveness:
How Does Accident Forgiveness Affect Future Insurance Applications?
Accident forgiveness in Ontario has a limited impact on future insurance applications because it doesn’t directly affect how other companies view your driving record. Even with accident forgiveness, you cannot control how long an accident stays on your driving record.
Thus, accident forgiveness will help maintain your current premium but won’t guarantee the same rate with a new insurer. When determining application eligibility, future insurance companies will still consider your driving history, including forgiven accidents.
How much your rate may increase after a car accident will depend on the following factors:
- The severity of the accident
- Fault determination
- Your driving record
- Your insurance company
Ultimately, the best way to ensure consistently affordable car insurance rates in future applications is to maintain a safe driving record.
Tips for Applying for Accident Forgiveness Insurance
There isn’t a separate application process for accident forgiveness insurance in Ontario. Accident forgiveness is typically an add-on feature offered by car insurance providers, not a standalone insurance product. However, these tips may help you get the best deal:
Key Advice from MyChoice
- Carefully weigh whether accident forgiveness suits your needs. If you’re only planning to keep the car for a short period, already have a heavily discounted insurance rate, or drive a very expensive car, the extra cost of accident forgiveness might not be worthwhile.
- Compare quotes from different insurance companies every few years to ensure you get the best possible rate based on your current driving record and risk profile.
- Raising your deductible (the amount you pay out of pocket before insurance kicks in) can lower your premium. Doing this can be a good option if you’re confident in avoiding accidents.