Senior drivers and older drivers can find a lot of information on the internet about ways to save money on their car insurance. However, most of the recommendations are simply either outdated and no longer true, flat out wrong, or are so miniscule in significance that they distract you away from what is important. By that I mean, expecting to find expert tips on saving money on car insurance as a senior focuses your attention towards the nickels and dimes, when you should be focusing on the dollars.
I researched plenty of "informative" articles claiming to help seniors save money.Here are common ways that you will read about how to save money on auto insurance that are really more fluff and window dressing than they are real ways to save money.
Bogus ways of saving money on auto insurance
1. Retiring. Many people falsely believe that changing your employment status from employed to retired saves a significant amount of money and auto insurance rates. That may have been true years ago, but not so much anymore. In fact, I have ran many experimental quotes in which I changed either the employment status from employed to retired, or change the use of the vehicle from commute to pleasure. Either way, it made zero difference on the premium. In fact, only about half of the companies even ask for questions like that when you're getting an auto insurance quote.
2. Taking adult safety courses. It is true that taking some type of mature driver safety course that is accredited through your state will give you an auto insurance discount with many companies. But the reality is that this discount is extremely minor, and you will more likely be paying a lot more for the course itself than what you would be saving in your auto insurance premium.
3. Suggestions of moving into a smaller town. This one is just plain silly! While technically this would be true because people who live in smaller towns typically pay less for auto insurance than people who live in big cities, it's still ridiculous to believe that's a consideration in saving money for auto insurance! Sure, you may move to a smaller town because real estate prices are cheaper. But no one ever moves to smaller town just for the purpose of lowering monthly bills. That's ridiculous! But yet you'll see that come up a lot if you try to research ways of saving money on auto insurance as a senior.
4. Suggestions of lowering your auto insurance coverage. Although you probably do not need to carry comprehensive and collision coverage on an older vehicle, there are other important parts of your policy where you do not want to lower coverage. This is especially true for liability coverage and uninsured motorist coverage don't skimp on those! And if a sales rep or an insurance agent suggest you do so, run for the hills!
5. Staying with the same company for a long time earns a big loyalty discount. It doesn't! Although your current auto insurance company would love for you to believe this, it simply isn't true. Again, loyalty discounts with most auto insurance companies is a mere spit in a bucket. Truth is, you will most likely save more money by shopping around for auto insurance. The fact is, many auto insurance companies love seniors and offer low rates. But you will never know it without shopping around.
Real ways to save money (Things that actually work!)
1. Paying your policy in full. You can earn quite a big discount by paying your auto insurance policy in full. In fact, I recently done some research on that and conducted a case study. You can see the results of the study here. The end result of a policy that's paid in full versus a policy spread out in monthly payments amounted to an average of 17.6%. That my friend is quite significant! No one earned less than 9.5% and some people saved nearly 30% just by paying their auto insurance policy in full.
2. Shopping around just like everyone else does. I don't know where the idea comes from that seniors belong in a different category as other drivers. The fact is their age group is really not much different than any other age group. And thus you should shop around for cheaper auto insurance just like everyone else does. In fact, these same ways of saving apply to all drivers.
3. Usage based discounts. More companies are providing usage-based discounts, and the discounts can be very substantial. Some usage based discounts go as high as 30% in savings. A prime example of that would be the Progressive Snapshot program. But many other companies are coming out with similar versions also. They all basically work the same way. It simply boils down to three things:1 If you drive your vehicle less than 15,000 miles a year. Refrain from driving between midnight and 4 AM. And 3. Refrain from hitting your brakes hard as much as possible, you will be a prime candidate for a big discount.
4. Paperless discount. Many auto insurance companies are also offering paperless discounts. All this simply is, is having insurance paperwork sent to your email address instead of via US mail. Any documents that aren't required by law to be mailed out will be sent to your email address instead. Contrary to popular belief, most seniors have their own email address. And that is all it takes to qualify for this discount. And for most companies, the average savings is $5-$10 a month.
Summary: Don't believe the hype! The four things listed above are the most significant things you can do to save money on your auto insurance policy. The five things listed at the very top are nothing but fluff and window dressing.
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Dan Lyles is an Independent Insurance Agent serving Ohio, Indiana, Michigan, Pennsylvania, Virginia and West Virginia..