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Transitioning to retirement often requires many financial adjustments. Indeed, switching to a fixed income often means living on a more restricted budget. And with inflation and soaring rates, consumers have been feeling the pain in many aspects of their lives.
One of these aspects is also the cost of car insurance, which has been rising. As CNBC reported, average annual premiums of full coverage auto insurance rose to $2,543 in 2024 — up 26% from the previous year. Of note as well, several insurers use age as a risk factor for pricing rates, as Car and Driver noted. And while the average cost of auto insurance decreases untilthe age of 70, it then increases again.
So, what can boomers looking for cheap comprehensive coverage on a retirement budget do?
Review Your Coverage Needs
Experian recommended reassessing your habits and lifestyle. This can include driving less or getting a smaller car. In turn, review whether your current insurance is still adequate, or if you’re paying too much. Indeed, as Experian further noted, with less mileage, you’ll likely pay less premiums.
It’s important to note for retirees who relocate in their golden years that premiums also vary depending on where you live.
Review your Deductibles
There are some moves retirees can make to ensure they are not overpaying for their insurance. For instance, several experts said that increasing deductions can lower car insurance premiums.
“Since your out-of-pocket expense goes up in the case of an accident, your premium will be lower. Just be sure you can reasonably cover these expenses if an accident does occur,” according to Kiplinger.
Look at Multi-Policy Discount
Another tip for retirees is to ask about discounts, noted Experian. Retirees can also save by getting two insurance coverages with the same provider. For instance, bundling a home an car insurance coverage will enable you to save via a multi-policy discount.
Kiplinger noted, for instance, that if you get both your auto and home insurance with Progressive, you will get savings of 7% on your auto policy.
Shop Around
Finally, another important aspect to lower auto insurance is to shop around. As Experian recommended, get quotes from multiple insurance companies and work with independent agents who can check different rates and coverage options.
This was backed by Kiplinger, which further noted to be sure to get at least three quotes before agreeing to a policy.
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