A Senior’s Guide to Auto Insurance

Experience matters, and being a mature, experienced driver does have advantages. For instance, many auto insurance companies will recognize your experience as a safe driver, which can translate into senior driver discounts.

If you are 50 years of age or older, have a clean driving record and no history of collisions, you may be eligible for a premium discount. Typically, insurance rates get lower as drivers roll into middle age and have years of driving skill under their belts. The tipping point for leveraging that experience, though, may be when you turn 70 years old.

Seniors tend to be cautious drivers, but many may not have refreshed their driving skills since learning to drive decades earlier. Statistics from Transport Canada show drivers over the age of 65 tend to suffer more traffic fatalities than other age groups. Taking a safe driving refresher course for mature drivers can enhance your skills, and help you maintain your good driving record.

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What Affects the Cost of Car Insurance?

Your age is one of many factors insurers weigh when determining your premium. There are others, including:

  • Your Driving Record. Whether your driving record is squeaky clean or littered with traffic convictions and collisions, either scenario enters the equation. The more traffic convictions and collisions you have, the more you’ll pay. However, if you have an excellent driving record, it will help you get a lower premium.
  • Years of Experience. Novice drivers of any age typically pay more than an experienced driver. That’s a bonus for seniors who have years of experience behind the wheel.
  • The Type of Vehicle You Drive. The overall value of your vehicle, its rate of theft and accidents, safety features, and the cost to repair it all affect your premium. Also, any vehicle that is classified as ‘personal use’ will cost less to insure than one that is classified as being used to commute to work.
  • How Much You Drive. Driving fewer kilometres per year means you’re less of a risk. If you’re driving less, let your insurer know to see if your premium can be reduced. If you are retired and rarely drive, tell your insurer.
  • Where You Live. Where you live makes a difference. Areas with higher occurrences of theft and collisions result in higher premiums. Plus, if you reside in a bustling city like Toronto, you’re more likely to pay a higher rate than someone who lives in a smaller or rural community.
  • Your Claims History. If you’ve been claims-free for at least six years, you may qualify for a discount. But if you have a collision or two in the last few years on your record, you may be viewed as a more significant risk and end up paying more.
  • Your Insurance History. Have you missed paying your insurance bills or have a gap in coverage (a period when you were not insured)? If so, it could work against you since either reflects a greater risk. If you have maintained continuous coverage, it ought to prove beneficial.
  • How Much Coverage You Need. The larger the scope of the coverage and the higher the coverage limits you choose, the more you will pay for insurance. A deductible is the portion of your auto policy you agree to pay upfront and before your insurance kicks in if you need to file a claim. Be sure, though, you have the budget available to pay the deductible should the need come to pass. If you are willing to take on more risk with a higher deductible, the insurer will offer a cheaper rate.

What Senior Auto Insurance Discounts Are There?

Finding the senior auto insurance policy that suits your lifestyle is important. Many insurance companies offer a few discounts you can tap into, and there are things you can inquire about, including:

  • Mature Drivers Discount. Many insurers will offer people aged 50 and older or who are retired and have clean driving records a lower rate.
  • Bundle Your Insurance. Combining your home and auto insurance policies under one insurer will get you a discount. If your current insurer doesn’t offer a bundling discount, shop around for another insurance company that does.
  • Change Your Vehicle Classification. If you are not commuting to work regularly or at all, or if you’re driving fewer kilometres per year, ask your broker or insurer to change your vehicle classification to “pleasure” and reduce your annual kilometre count.
  • Join the Canadian Automobile Association (CAA)[FC1] . If you’re a member of CAA, you may qualify for an insurance discount, plus there’s the added benefit of roadside assistance help should you need it.
  • Sign Up for Usage-Based Insurance. You can potentially earn a monthly discount by enrolling in an insurer’s usage-based insurance program, which rates how you drive, how often, and how far.
  • Vehicle Safety Discount. Suppose you have a newer vehicle that is equipped with what's known as Advanced Driver Assistance Systems such as lane departure mitigation, blind-spot detection, and rear-view cameras to assist when reversing or parking. In that case, some insurance companies will provide discounts for those safety features.

There are a few other ways that experienced drivers may be able to save on their monthly premiums:

  • Drop Your Collision Coverage. If your vehicle is 10 years old or older, you may want to talk to your broker about removing the collision coverage on it.
  • Keep Your Vehicle in Tip-Top Shape. Regular maintenance on your vehicle is essential. Ensuring your car or truck is in excellent condition reduces the chances of breakdowns, as well as the possibility of getting into a collision.

Meanwhile, a survey of Canadian drivers about the impacts of COVID-19 finds 54% of older policyholders (those 55 years of age and older) say the pandemic affected them financially compared to 48% of their younger counterparts. However, only 33% of drivers who are 55 years old and older say they will shop around when their policy comes due for renewal.

It's important to remember loyalty is a two-way street. In general, it’s wise to compare products and prices before you buy to find the lowest cost. The same rule of thumb applies to shopping for auto insurance, especially when your policy is up for renewal.

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