Why You Need To Reevaluate Your Insurance When You Retire
Your auto insurance is affected by so many things that you need to reevaluate your coverage, plus its rates, every time you reach a major milestone in your life. For example, it's wise to reevaluate your auto insurance after retirement because some of the changes associated with your retirement may increase or decrease your rates. Here are some of these changes to discuss with your insurance agency:
The more you drive, the more likely you are to experience an accident and injure yourself or damage your car. This is the number one reason your auto insurance company is interested in your annual mileage. Some people find themselves driving less and less after retirement. You may find yourself in such a situation, for example, if you mainly used your car to commute, but now you no longer leave the house for work. The reduced mileage may entitle you to low-mileage discounts and reduce your insurance premiums.
Reason for Driving Changes
Apart from mileage, your use of the car also affects its insurance rates. Broadly speaking, you can insure your car for social, commuting, social and commuting, and business use. Once you give the insurance company that information, it can use the data to determine your premiums.
This is another issue that may change upon your retirement. For example, if you used to use your car for commuting and social purposes, and you no longer drive to work, you may find yourself using it only for social reasons. You may also start a business and transition your personal car into a business car. Whatever the cause of the change, it may affect your coverage rates.
Driving and Parking Locations
Lastly, you may also start driving in different locations or parking your car in a different geographical area after your retirement. This may be the case, for example, when you start driving for leisure (maybe you are now taking frequent road trips) or you have bought a retirement home in another part of the country. This is another thing that may affect your insurance rates. Insurance companies know that some roads are more dangerous than others and some neighborhoods are slow more dangerous than others, which is why they use driving and parking locations in their rate calculations.
As you can see, it's not always a good idea to keep renewing your auto insurance coverage year after year without reevaluation. If that's what you have been doing for the past several years, contact your insurance agent to see if there are things you can do to secure better rates.