The best auto insurance for retired people is similar to the best auto insurance for people who are still working. It's the coverage that suits the driver's needs at the lowest possible cost. While retirement doesn't, in and of itself, change the nature of car insurance, the retired lifestyle and the age at which many people retire can impact which insurance carrier turns out to be the best choice.
The age of a driver plays a major factor in how much an insurance policy costs. In a 2013 survey conducted by CarInsurance.com, the same six-month insurance policy from the same company cost anywhere from $480 to $1,948 just depending on a driver's age. The relative pricing between companies remained the same for drivers between 24 and 60, meaning that every company reduced rates as drivers aged and theoretically became less risky. However, once the driver's age exceeded 60, some companies continued dropping rates while others started to increase them. This means that retired people will have to shop around to find a company that rewards their experience instead of punishing them for their age.
Car insurance companies look at factors other than age, though. They may look at a driver's gender or do a credit report check to set premiums. Choosing an insurer whose underwriting criteria line up with a given driver's strengths can be a way to save money. In addition, some insurers in some states offer discounts for retired drivers who complete defensive driving or safe driving courses. In some states, the discounts are mandated by law, making it particularly easy to find an insurer that will reduce premiums.
Another way to save money is to increase the deductible on an insurance policy. With a higher deductible, the policyholder pays a lower premium but will have to spend more out of pocket for repairs if he is at fault in an accident. If he's on a fixed income, he might do better by taking the risk of the higher deductible than by paying more out of his limited income for insurance that he might not ever need.
If a driver is no longer commuting, he might be able to get rid of one car and its insurance bill completely. On the other hand, if he chooses to keep an older car for occasional use, dropping its collision and comprehensive coverage can help to save money, although it won't be covered if its driver is at fault in an accident. Another alternative is to trade a rarely used commuting car out for a unique collectible dream car. Collectible cars that are only driven occasionally typically qualify for lower insurance rates than other cars and can also be a pleasure to own.
Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.