The nationally-recognized organization for retired people may be squeezing some extra money out of seniors from their business endorsements.
According to a Bloomberg News article, the AARP collects "hundreds of millions of dollars annually from car insurers who pay for AARP’s endorsement."
The insurance company builds the cost of the fee owed to AARP into the consumer’s policy, which may make some car insurance costs higher when compared elsewhere, according to the article.
Last year, the fees associated with the car insurance endorsements accounted for 43 percent of $1.17 billion in revenue for AARP, Bloomberg reports.
The amount has apparently been rising since 1999 when the fees only accounted for 11 percent.
John Wider, executive vice president of AARP Services Inc., a for-profit subsidiary, told Bloomberg AARP uses the revenue to fund its member services.
Still, some seniors are finding cheaper car insurance deals from companies like Geico.
Richard Ostor of Florida told the news provider he joined AARP for low car insurance. In April, his premium rose to $950 a year with no accidents or traffic tickets. Ostor eventually switched to Geico for similar insurance at $640.
© Copyright
