How Seniors Can Lower Auto Insurance Costs
If you have noticed your car insurance rates rising now that you are older than 65, you are not alone. Many insurers raise rates for seniors because physical changes, such as hearing or vision loss and slower reflexes, make you more prone to accidents.
If you are tired of overpaying, use these following options, some of which are only available to seniors, to help you lower your monthly insurance premiums.
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Get a Driving Lesson
Driving lessons are not just for teenagers wanting to get their licenses these days. Many companies, such as AARP and AAA, offer driver safety courses for seniors. Some states even offer course options directly on their DMV websites. Most courses are reasonably priced and offered online, making it simple for you to log on and learn from the comfort of your home.
According to Insurance.com, there are currently 34 states that mandate an insurance discount if you take one of these courses for seniors. Most of the time, your discount will clock in at five percent of your premium cost. However, some states mandate a much higher 10 to 15 percent discount.1 This can offer significant savings because most auto insurance companies charge well over $1,000 per year past the age of 60, according to Value Penguin.2
Choose a Safe, Reliable Car
At any age, the model, style, and age of your car will make a significant difference in your auto insurance rates. However, this is even more important to consider as you age. The cheapest car to insure is one that your insurance agency considers to be safe and that rarely requires repairs. Plus, certain car models tend to be driven most often by safe drivers and have gained a reputation for keeping people alive in crashes.
Be sure to make the following considerations before completing your car purchase.
Consider an IIHS Top Safety Pick
A Top Safety Pick is a car that has proven it can perform well in crashes. IIHS also looks at such things as headlight ratings, size and weight of a vehicle, and safety warning systems.3
Consider Adding Safety Features to Your Car
According to Nerd Wallet, some insurance companies offer discounts for such features like anti-lock brakes, anti-theft systems, lane-departure warning systems, stability control, and airbags.4
If you want to save money overall, purchase a used vehicle with as many safety features as possible. Older cars are cheaper to insure because they are cheaper to replace when compared to most newer cars.
Protect Your Car
Protecting your car is more than just keeping it clean, avoiding scratches and bringing it in for a thorough detailing twice per year. Instead, you can use a variety of safety features to protect your car from thieves, protect yourself from accidents, and protect your insurance rates from rising wildly. Other ways to protect your car include:
- Choose a new car with safety features as already noted.
- Have an older car retrofitted with safety features, such as a backup camera.
- Ask your insurance provider about tracking devices.
U.S News & World Report states that tracking devices, sometimes called telematics devices, follow your driving habits. If you have better driving habits, such as average speed and braking, when compared to others in your demographics, you may be able to score cheaper rates. Some companies go with mobile app tracking rather than telematics devices. Before opting into one of these programs, find out if your provider will ding you for bad driving or will simply use the information to give you incentives.5
Report to Your Insurer That You Have Been Driving Less
If you are 65 or older, you may be retired. Even if you are not completely retired, you are most likely not traveling to your workplace as much as you once were or you may be choosing to work from home. If your driving habits have changed, you should let your auto insurance company know so that your premiums can reflect this. In addition, the company will take note of whether you use your vehicle primarily for commuting to work or for pleasure driving.
The savings you can garner as a low-mileage driver will depend on your state of residency. However, providers in some states can give you a 10 percent discount if you drive less than 7,500 miles per year, according to Insurance.com.
Another option if you rarely drive is to choose a pay-as-you-go insurance policy. According to Car Insurance 101, this option is good for anyone who rarely drives, including those who are environmentally conscious.6 As an older adult, however, you may be able to save significantly during periods when you drive infrequently. Keep in mind that your rates will change each month, so you will need to budget accordingly.
Shop Around and Compare Quotes
Just because you have stuck with one insurance company your entire life does not mean that you must practice brand loyalty forever. You may be surprised to find out what some other insurance companies are willing to offer you. In addition, remember to consider local and regional providers that may not have as much name-recognition as nationwide companies do. Not only do local companies often offer lower rates than their nationwide counterparts, but they are often known for great customer satisfaction.
Credit Karma recommends shopping for a new rate every year. Most insurance companies frequently adjust their rates and many today are working hard to stay competitive. Plus, shopping around can help you ensure that you are not missing any savings or extra discounts.7
By resisting the urge to become complacent about your auto insurance rates, you can uncover a variety of ways to dial down your premiums even after the age of 65. Never feel bad about shopping for better rates with new companies or about contacting your insurance agent to ask about ways that he or she can help you save. Take your time when making your decision because it is likely that there is a better rate just waiting for you to find it.