It's never too late to save money on auto insurance.
In fact, old drivers could have more opportunities to lower their costs of auto insurance, since they may not drive as often or get tickets as frequently as younger drivers, says Phil Reed, senior consumer advice editor with Edmunds.com, a popular car-shopping website.
Here are seven tips that can help old drivers save money on their car insurance.
1. Review your current policy.
As you age, it's important to examine your insurance policy and ensure it addresses your current situation and needs. If you review your policy every year and make adjustments, your rates will likely decrease, Reed says. He suggests taking an hour to research online current rates and types of discounts offered by insurers, and call an insurance company or insurance agent. That may be all you need to do to find ways to save.
2. Ask for discounts.
Take advantage of every possibility to attain discounts from an insurance company, which could reward you for years of good driving behavior or being a loyal customer. For example, you may be entitled to a safe driver discount, which can save up to 10 percent on your premium. For example, State Farm offers up to 10 percent off if a driver has received no moving violations and has not been involved in at-fault accidents for at least three years.
Membership in trade associations in your industry or senior/retiree groups could further shave your auto insurance costs.
3. Drop certain types of coverage.
It may no longer be worthwhile for an old driver to carry collision insurance, which pays for damage to your vehicle from accidents involving other cars. If a senior has been driving the same car for years, the older car might not be worth enough money to require collision coverage, which also covers damage when hitting objects such as a pole. According to Allstate, collision coverage is usually the most expensive part of a motorist's total insurance premium, since accidents are the most common type of insurance claim.
Another type of coverage that could be dropped is liability coverage, which protects car owners from damage they cause to others or to someone else's property in an accident. However, this may be a big risk to take. Reed says you should consider how much you're willing to take responsibility for -- and whether the savings you'd get from dropping the coverage is worth it.
Extra coverage on the insurance policy such as roadside assistance, which helps motorists with tasks such as towing, could go away if seniors also are members of an auto club, such as AAA, that offers the same emergency assistance.
4. Boost your knowledge.
Taking a driver education safety class could refresh seniors’ skills behind the wheel and help old drivers learn defensive driving techniques. Boosting driving knowledge is a smart idea as seniors often experience slower reaction times to roadway incidents, such as other drivers running red lights.
Taking a defensive driving course can also lead to discounts. More than 20 states, including Alabama and Florida, require auto insurers to offer discounts of 5 percent to 10 percent to motorists who complete a state-approved driver education course, according to the non-profit AARP, which has a membership of more than 37 million seniors. The AAARP offers an AARP Driver Safety Program specifically for individuals aged over 50. The courses are taught in person at sites including community centers, senior centers, churches, libraries and driving schools, as well as online.
5. Change companies or payment types.
Getting multiple car insurance quotes from different insurers can really pay off. You could save by switching your auto insurance policy to another company with lower rates. You can get quotes online, but you’ll still purchase your policy personally from an insurer, Reed says. Another option is for seniors who don't often drive is a pay-as-you-go insurance plan, offered by insurers including State Farm and Progressive. Your premium will depend on how many miles you drive, and the less miles you drive, the cheaper your premium may be.
6. Downsize in the garage.
Some seniors choose to downsize their homes, and they should think of doing the same for vehicles. "Sometimes a couple may have two cars and they could consider downsizing to one car. That would drop the premiums quite a bit," Reed says.
7. Suspend coverage when traveling.
For seniors who are traveling in retirement and taking cruises or tours that last a month or more, a cost-saving measure could be to suspend their coverage while away from home and not driving. The savings could be around $100, Reed says, leaving seniors more spending money for souvenirs, wine or fancy dinners while exploring the country or world.
However, it’s important to ask your insurer if there are costly consequences for suspending coverage when traveling for an extended period. For example, you could face higher rates if you restart your coverage, causing your plan to save to backfire.