Tips for Getting Cheap Car Insurance in Retirement

Last Updated on November 30, 2020

As a retired person, you have different car insurance needs than someone who works full-time. By adjusting insurance accordingly, you can save hundreds of dollars on car insurance every year.

Some car insurance companies cater specifically to retired drivers. These companies like having safer, older, more experienced drivers to balance out the pool. Other companies prefer younger drivers, which is why they charge higher rates to retired drivers.

Smart retirees also take advantage of low mileage discounts, pay-per-use insurance, and other unique insurance options to save even more money on car insurance.

Today, we’re explaining how to get cheap car insurance in retirement, including the top 10 best car insurance companies for retirees.

Cheap Auto Insurance for Retirees: Tips & Tricks

By taking advantage of certain strategies, you can get cheap car insurance as a retired person. Here are tips and tricks for securing the cheapest car insurance rates as a retired driver:

Change your Driving Status

After retiring, you may no longer be considered a ‘commuter’ for insurance purposes. You’re not driving at rush hour, and you’re not spending hours on the road every week. Statistically, you’re less likely to be involved in an accident or make a claim.

Contact your insurance company and change your driving status. You might now be qualified as a ‘pleasure’ or ‘leisure’ driver instead of a commuter. That could mean significant car insurance savings.

Ask About Low Mileage Discounts

The average American drivers approximately 12,000 miles per year. The average American also works full-time and commutes back and forth to work every weekday.

If you are retired, then your mileage may be cut in half.  Instead of driving 12,000 miles per year, you might drive fewer than 6,000 miles. That means half as much time spent on the road – and half as many chances to make a claim. Many companies offer low mileage discounts to retired drivers. Sometimes, you qualify for a low mileage discount just by contacting your insurance company. In other cases, your insurance company requires you to install a tracking device or use an app to verify your low mileage.

Sign Up for Telematics or Driver Tracking Programs

Most insurance companies now offer some type of driver tracking program or telematics discount. In exchange for installing a tracking device in your vehicle for 90 days (or using a mobile app), you can save 30% or more on car insurance.

The insurance company uses this data to verify your low mileage status. The insurance company also tracks braking habits, acceleration, speed, driving times, and other information. Retired drivers with safe driving habits and low average mileage could save hundreds per year.

Compare Quotes to Find the Best Option

Some car insurance companies love older, safer, more experienced drivers. In fact, drivers in their 50s, 60s, and 70s pay some of the lowest rates for car insurance in the United States, all else being equal.

Statistically, drivers in their 50s, 60s, and 70s file fewer claims and cause fewer accidents than drivers in any other age group. By comparing multiple quotes, you can find a company that provides the best, cheapest rates as a retired driver.

Buy Pay-Per-Use Insurance

Some insurance companies now offer pay-per-use insurance. Metromile, for example, charges drivers based on their specific mileage. If you are a low mileage driver, then pay-per-use insurance could lead to significant cost savings.

Take Advantage of Discounts

Some of the discounts available to retired drivers include:

• Bundling Discounts: Older drivers might have multiple insurance products. By bundling all policies together – including car, home, and life insurance – with a single company, you could save considerably across all policies.
• Homeowner Discounts: Some insurance companies give a discount just for owning a home.
• Defensive Driving Course Discounts: Some states require insurance companies to give a discount to older drivers who complete a defensive driving course. In New York, most auto insurance companies do give discounts for completing defensive driving courses. If your insurance company is raising your rates because you’re an older driver, then you may (legally) have an option to take a defensive driving course and avoid higher insurance premiums.

Remove Younger Drivers from Your Policy

As a retired person, you may or may not still have children living at home. If you have younger drivers on your policy, then these drivers could be doubling premiums. Remove young drivers from your policy to save money.

Alternatively, some insurance companies offer student away from home discounts. If your child is living away from home as a full-time college student, then you could save money on car insurance while still providing coverage to your child.

Be Prepared for Rates to Rise After a Certain Age

You might pay the lowest possible rates for car insurance in your 50s, 60s, and 70s. In your late 70s and beyond, however, prices start to increase. You might pay higher rates for car insurance in your late 70s. Statistically, older drivers are more likely to make a claim and cause an accident. Some drivers have poorer vision and reflexes at this age. If you are an older retired driver, be prepared for higher car insurance premiums after a certain age.

Some companies start increasing premiums even earlier: some companies start raising premiums after age 65, for example. Consider switching insurance companies if you notice rates increase soon after you retire.

Generally, drivers in their 50s and 60s pay around $1,200 per year for car insurance or less. In your 70s and 80s, however, you might pay $3,000 or more for car insurance every year.

Move to a New State

New York is expensive. Many retirees move to a new state to take advantage of different tax rates, good weather, and other advantages. Just like states have different tax advantages, states also have different insurance laws. In some states, drivers pay less than $900 per year for car insurance, on average. In other states, drivers pay over $2,200 per year.

States like New York, Florida, and Michigan, for example, have notoriously expensive car insurance premiums for seniors, while states like Ohio and North Carolina have much cheaper car insurance premiums for seniors.

Top 10 Best Car Insurance Companies for Retirees

Some companies like having retirees in their insurance pool. Retirees tend to be older, safer, and more experienced drivers. In fact, drivers in their 50s, 60s, and 70s pay some of the lowest possible rates for car insurance.

Other companies are less welcoming towards retirees. They prefer having younger, less experienced drivers in the pool because they pay higher rates for car insurance.

By switching from one car insurance company to another, you could save hundreds – even thousands – of dollars per year on car insurance.

Below, we’ve listed the top 10 car insurance companies for retirees, including the car insurance companies with a proven reputation of offering lower rates and better service to retired drivers across the United States.

• GEICO
• USAA
• Allstate
• State Farm
• The Hartford
• Erie Insurance
• Metromile
• Progressive
• American Family Insurance
• Nationwide

Most of these companies offer some type of retired person discount. Some companies simply offer cheap rates to drivers of any age. Other insurance companies cater specifically to retired individuals.

GEICO, for example, provides a guaranteed renewal perk for drivers 50 and older with no accidents in the past three years (and no drivers under age 25 on their policy).

AARP members, meanwhile, can get a significant discount when buying car insurance through The Hartford. The Hartford has partnered with the AARP to provide cheaper car insurance to members.

Similarly, Allstate offers drivers 55 and older its ‘55 and Retired Discount’. If you are above age 55 and are no longer working full time, then you can save on car insurance.

Other insurance companies are ideal for occasional drivers – like retired drivers who drive fewer than 6,000 miles per year. If you are a low mileage driver, then a pay-per-use insurance company like Metromile may be the right choice for you.

Final Word on Finding Auto Insurance in Retirement

Car insurance for retirees is cheaper than many drivers realize. By taking advantage of special discounts, you can save hundreds of dollars per year on car insurance.

Depending on the situation, some retirees can also benefit from low mileage car insurance, pay-per-use insurance, and other unique insurance products.

Compare quotes online today to ensure you’re paying the lowest possible rates for car insurance as a retired driver.