Does Retirement Affect My Car Insurance?
When you think about retirement, your mind probably goes straight to your retirement savings plan and what you’ll do with your newfound spare time. But have you also considered how retirement would affect your car insurance? The truth is: retirement may, but won’t necessarily affect what you pay for auto insurance. Whether your car insurance changes after your retirement depends on how much your driving habits change after you’re no longer working.
You should tell your insurer anytime your driving habits change. If you’ve made a lifestyle adjustment (like cutting out your daily commute) that will result in less driving – you’ll likely qualify for an auto insurance discount.
Ask your insurer about changing your policy to reflect that you’ll solely be driving for leisure once you retire. The fewer kilometres you drive in a year, the more likely you are to qualify for insurance discounts. In addition, insurance companies generally view leisure driving as less risky than commuting, which often requires driving daily during rush hour traffic.
If you plan to drive more for leisure after you retire – say for various cross-country road trips – it’s also vital that you let your insurer know. You may have to pay more for your coverage. Still, a slight premium increase is worth it to know that you have enough insurance protection in the case of an accident or other expensive vehicle-damaging incidents.
Remember that you need comprehensive insurance to cover vehicle damage that isn’t the result of a collision. So if your retirement plan involves driving through the wilderness to the cottage or a fishing trip, the comprehensive portion of your insurance policy can cover a chipped windshield from travelling on a remote rocky road or vehicle damage after a collision with an animal.
Not planning to take your foot off the gas after retirement? Except when it’s necessary to drive safely, of course. Here are a few more ways to save money on insurance before and after you retire.
- Consider adjusting your deductible. If your retirement savings allow you to afford to pay out a higher deductible in the event you need to make a claim, raising your deductible is a good way to save on your monthly insurance premiums, especially if you’re driving less.
- Older vehicles may not need collision or comprehensive coverage. If you have an older ride that you don’t want to retire, it’s essential to consider the cost of insurance for repairs or replacement versus its total market value. On the other hand, if you have a brand new set of wheels or a pricy classic model, optional comprehensive and collision insurance are likely worth it to protect your investment.
- Don’t forget you have options. If your insurance company offers you a loyalty discount, that’s excellent. However, taking a few minutes before your policy renews to get quotes from their competitors can help ensure you’re getting the best deal for your insurance needs.
- Ask about home insurance discounts. If you’re spending more time at home, you’ll be better able to guard it against threats like fire and theft. Many insurance companies offer discounts on both homeowner’s and renter’s insurance coverage to retirees.
Retirees with good driving records are well-positioned to get some of the best insurance rates available. By driving safely, maintaining your vehicles and making your premium payments, you’ve earned above-average insurance savings. So whether your next chapter includes less commuting and more adventures or simply more time at home with the people and hobbies you love, talk to your insurer about which retirement insurance discounts are available for you.
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