How to Get the Best Deal on Car Insurance

You've probably had this experience: you're frustrated because the driver in front of you is going too slow for your liking. You can see the driver's gray hair and think that this person should not be driving any longer. Just the opposite is true: 60-something drivers gets the last laugh. Not only are they more likely to arrive safely at their destination, they are rewarded for it with lower auto insurance rates. "Older drivers by and large are far safer in terms of the number of accidents they have and the number of claims they turn in than the typical driver," said Marty Agather, senior vice president of the consumer resource site TrustedChoice.com. He says insurance companies collect incredible amounts of data to set prices. "The sweet spot in the auto marketplace is someone who is recently retired but still vital," according to Agather. "They're not driving to work every day, still with it, and their reaction time has not slowed down too much. You still have a very safe operating behavior." According to 21st Century Insurance, "senior citizens are some of the safest, most responsible and defensive drivers on the road." As a result, many insurance companies offer special rates and discounts for these mature drivers. In general, rates for drivers who are 50 and 74 years old are 5 percent to 15 percent below those for people 30 to 50. And of course, drivers younger than 25 can pay more than double what the seniors pay. "For young males, the numbers are astronomical," said Agather. "They are 200 times more likely to get into an accident." As Your Life Changes, So Does Your Premium DMV.org says car insurance rates gradually decline from the time you turn 25 until you turn 70 -- as long as you maintain a good driving record. By the time you're in your 40s, you are likely to have a family, which encourages safer driving, and you are less likely to be at a bar at 2 a.m., which does not. But once you hit 70, rates start to go up again because you are more likely to have impaired vision, slower reactions and poorer cognitive functions. For those in the 50-to-70 sweet spot, some discounts are applied automatically; some require you to inform your agent or insurance company of changes in your lifestyle; and others come from being pro-active. For example: Low-mileage discount. If you're retired, you have probably cut down on the miles you put on each day. Inform your agent and your insurer. They don't know about changes in your life unless you tell them. Defensive driving classes. AARP, AAA and others offer classes for drivers of all ages. They cost about $50, usually earning a discount of up to 5 percent a year, for three years. AARP says automatic discounts follow a course for drivers in Alabama, Alaska, Arkansas, California, Colorado, Connecticut, the District of Columbia, Delaware, Florida, Georgia, Idaho, Illinois, Kansas, Kentucky, Louisiana, Maine, Minnesota, Mississippi, Montana, Nevada, New Jersey, New Mexico, New York, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Virginia, Washington, West Virginia and Wyoming. Residents of other states should ask their insurance agent about discounts. Policy changes. Older people with more assets may want to take the risk of going with a higher deductible -- and they might also want to boost liability coverage. Agather said you need to make sure that your liability limits equate to the assets you have at risk. "Just because you have an insurance policy, that doesn't limit how much you are liable for in damaging someone else," he warned. "Your assets are at risk if you hurt a brain surgeon or hit a Ferrari." To protect those assets, he recommends an umbrella policy that protects your assets if you are sued for more than the liability limit on your auto policy covers. "It also may make sense to drop comprehensive and collision coverage, which may be costing you $400 to $500 a year," said Agather. "Don't pay a lot of money to insure something you can afford to pay out of pocket," especially if you're driving an older car.