So even with a not-at-fault accident (say you were rear ended) you would still end up paying higher rates?
No. A non at fault auto accident does not penalize the policy holder. But too many comphrensive claims like deer hits and vandalism will increase rates.
I'm assuming this "claim free discount" really isn't that big.
It is provided you can stay clean for at least the next 6 to 9 years depending on the company. If you have a second at fault claim prior to that period you get rated as if you have had two; the "claim free" incident and the current one. So the "claims free" accident is brought back into future rates which would result in a two accident rating. The premium on that would be nasty. That's my understanding anyways. It could be different, but the "claims free", again just from my understanding, is not total forgive and forget.