Is it better to seek permission or forgiveness? For selling accident forgiveness without permission, Allstate Insurance Co. agreed Wednesday to pay a $600,000 settlement to three Southern California counties. At issue were national advertisements for auto insurance accident forgiveness programs that offered to protect motorists from having their insurance rates increase the first time they are responsible for an accident. The ads aired in California, which outlaws such programs. The civil complaint against Allstate and a similar one against the Liberty Mutual Group alleged false advertising and unfair competition. Liberty Mutual agreed in October to pay $925,000 to settle its case. The Allstate settlement ends a lawsuit filed last week in Riverside County Superior Court by district attorneys in Los Angeles, Riverside and San Diego counties. Prosecutors said Allstate launched a nationwide television ad campaign several years ago touting its accident forgiveness program, with insufficient notice that the program is not available in California. Until 2010, when Consumer Watchdog challenged their legality, accident forgiveness programs were allowed by the California Department of Insurance. The Santa Monica-based nonprofit group argued the programs violated Proposition 103, passed in 1988, which sets guidelines for legal insurance practices and products in the state. Prop 103 requires insurance companies to open their books and submit to public hearings to justify that rates are not excessive and insurance products are legal. Under the accident forgiveness program, Allstate charged drivers up to 15% higher-than-normal premiums with the promise that future tickets or accidents would not be used to increase premiums. According to Consumer Watchdog, the program’s “purported benefits were not worth the premium being charged.” According to the consumer group, Allstate was violating California’s good driver discount law, unfairly discriminating against drivers despite their good driving record, selling a deceptive product, and encouraging irresponsible driving. Allstate agreed to stop issuing accident forgiveness coverage in California starting in 2011, and transitioned 150,000 affected policyholders in the state to other coverage. This ended an investigation by the Insurance Department that would have required the insurer to release thousands of internal documents to the state and face a public hearing. Under terms of the settlement, an injunction will be filed against Allstate requiring full compliance with state law with its accident forgiveness advertising, including disclosure of the fact that such programs are not available in California, with more prominent disclaimers included in national ads. The company admits no wrongdoing as part of the agreement. Both settlements are evenly split among the three counties. The bulk of Los Angeles County’s share of the settlement is considered a civil penalty that will be spent on enforcement of consumer protection laws, said Greg Risling, spokesman for the county District Attorney’s office, with $25,000, set aside to cover administrative costs.