The amount you’ll spend on insurance (excluding health coverage) drops dramatically once you hit retirement age. The average under-65 household spends approximately $8,100 a year on insurance—including annuities, life insurance and other personal insurance plans, such as homeowners insurance. In retirement, that number drops to $2,840, an almost 65% change in spending.
Most people pay for life insurance while they have a family to support and may opt out once their children are no longer financially dependent.
At the same time, retirees may be eligible for discounts on auto and homeowners insurance.
Most states offer older adults discounts on car insurance if they complete a defensive driving class, such as one offered by AARP or AAA. And the Insurance Information Institute says that retirees are more likely to receive discounts on homeowners insurance because they are at home more often, reducing the risks of burglary and fire.