As unfortunate as it is, when a person gets older, some expenses just seem to increase. While retirement can be a wonderful thing, some of the increased costs can seriously hurt. Car insurance is one of those that seems to go up higher than it should during retirement. The insurance company deems you a higher risk once you reach a certain age, but luckily, there are some ways that you can fight back and actually save money on your policy and for many seniors who are retired, even saving a few dollars on their car insurance policy can be a big help.
These days, some insurance companies are basing policies on outdated data. For example, people have more longevity now and experts predict even further retired growth, with the number of people over 70-years old expected to double by 2030. But before you pay too much for car insurance, here are some ways that you can save money if you are a senior citizen.
The Standard Senior Discount
Sure, getting ten percent off of a meal at McDonald’s isn’t a huge deal. Still, a discount is a discount. But when it comes to car insurance, if you got a 10% senior discount you would save quite a bit of money. On a policy that is $650 per year, the savings is $65. Of course, there are some caveats that come with the senior discount from your insurance company. Here are some tips on making sure you get the most out of discount programs for seniors from your insurance.
Ask about a discount for passing a driving course intended to judge defensive driving skills. You might get a larger discount in addition to the normal senior discount that your company offers. You’ll find that this program varies considerably from one state to the next.
Another great tip is to update your mileage often, financial experts say. If you don’t drive as much as you used to now that you don’t have to commute to work and back, you might be able to save a little money on your car insurance. Ask your company if they offer any kind of low mileage premium discount and what mileage limits you need to stay under (and for how long) in order to receive that discount.
The make and model of a car also has a significant impact on auto insurance premiums say experienced insurance agents. If you already want to pick a safe vehicle that performs well, there is no better place to look than the list of “safe cars” that your insurance company keeps. The safest vehicles from the Insurance Institute for Highway Safety (IIHS) lists “Top Safety Picks” every year that you can find online.
Does Your Policy Fit You Like a New Suit or an Old Jacket?
Just like clothes, we grow out of (or into) new insurance policies. Just because you have always had a specific insurance policy doesn’t mean that you need to keep that policy forever. You might not fit that policy anymore. In fact, you might fit a brand new policy that will save you some serious money on your car insurance premium. Factors like age, marital status, number of miles driven per year, motor vehicle record and credit history are just a few of the things that can affect an auto insurance premium that change all the time. If any of these change, you should reevaluate your options and decide if you need to move to a different policy. However, in retirement, some factors have the opposite effect as they would on a younger person. For example: if a young person turns 25, their insurance rates go down. On the other hand, if someone turns 65 or 75, their insurance rates are probably going to go up. So, unless you have to, you may not want to have a new quote after all.
Auto insurance companies feel justified (and might even be a little) in upping rates for seniors because as people get older, their vision gets worse and puts them at risk for an accident. Reflexes are also not as quick as they once were and so these facts make insurance companies change their rates. But you don’t necessarily have to take the rates lying down. Here are some tips to try combat the rate hikes.
Since you are driving fewer miles and know that you have a much smaller chance of having an accident, you can increase your deductible and lower your monthly premium. The danger in doing that, of course, is that if you do have an accident, you will have to pay a huge deductible before you can get insurance to cover anything. So, you’re taking a risk based on your own driving ability.
You also might want to consider changing your policy. Perhaps you don’t need all those extras that you added when you still had kids in the house. If you aren’t driving as much as you used to, the it makes sense that you don’t need as many features as you used to, and you can lower your premium significantly if you drop comprehensive and collision.
If there are two of you, but only one of you is driving, you might want to designate that person as the primary driver. That way you can take advantage of any discounts that you might get if the person driving qualifies for a lower premium. A common example of this is a child that drives the parent everywhere. There is no reason to pay high premiums for you to drive if you are planning to let your child chauffeur you.
There are some warning signs that go along with getting older and losing the ability to drive well. If you notice any of these symptoms in yourself, or if you are the child and you notice them in a parent, you may want to reevaluate who is doing the driving: Signs like driving faster or slower than the other traffic, taking medication that impairs vision, reflexes or concentration, and having minor accidents or getting lost more often.