The Best Alabama Auto Insurance Company
Alabama’s auto insurance rates are on the low side — on average $868 per year, compared to the nationwide average of $1,009. That said, how much you’ll pay can vary a lot depending on your car, your coverage, and your address. Use our tool to find your best rates:
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You’re going to need car insurance in Alabama — the state passed a mandatory auto insurance law in November 2017 and fines start at $200 for drivers caught without insurance. Alabama car insurance is under the national average; drivers pay an average $868 in premiums per year, compared to the national average of $1,009. However, insurance rates are going up due to a combination of increased severe weather activity — Alabama ranks third in the nation for tornadoes and fifth in the nation for wildfires — and the state’s high percentage of uninsured drivers. In 2015, 18.4 percent of Alabama drivers were uninsured; the state’s mandatory auto insurance law should bring that percentage down, but don’t expect rates to drop with it.
If you’re looking for the best auto insurance in Alabama, you need to compare not only your rates, but also your coverage options. The state’s frequent severe weather means you should probably add comprehensive coverage to your insurance package — it’ll help pay to repair your car if it receives hail damage, for example. You should also consider additional coverage options, such as rental reimbursement coverage, which helps cover the cost of a rental car while yours is being repaired. Look for the insurers that offer the coverage packages you need — and look for insurers that offer premium discounts for features your car already has, such as air bags or anti-lock brakes. The more discounts you qualify for, the more money you’ll save.
Alabama Minimum Liability
Here’s the minimum amount of insurance you need to drive in Alabama:
- $25,000 bodily injury coverage per person
- $50,000 bodily injury coverage per accident
- $25,000 property damage coverage per accident
You’ll often see those numbers referred to as 25/50/25 — so if an insurer references a 25/50/25 policy, that policy covers the minimum amount of insurance required to legally drive in the state.
You’re probably going to want more than the minimum amount of insurance, though. You might want comprehensive insurance to protect your car from damage from weather, theft, or other outside sources; you might also want collision insurance, to protect your car if you accidentally drive it into a ditch, for example. Since Alabama has such a high percentage of uninsured drivers, you might also want underinsured/uninsured motorist coverage — if you get hit by an uninsured or underinsured driver, your insurance provider will help cover the costs that their insurance provider should have covered.
You can buy insurance to cover all kinds of things: pet injury coverage to protect your pets, equipment coverage to protect your custom stereo, roadside assistance coverage to help tow your car out of that ditch you just drove it into. Take some time to review the options offered by our top insurers and make sure you visit their websites to review their complete lists of coverages.
How We Found the Best Auto Insurance in Alabama
We evaluated the four largest auto insurance providers in Alabama using the same methodology we used for our nationwide auto insurance review. We compared financial stability ratings from A.M. Best to determine each insurer’s potential ability to pay out its claims. We also looked at customer service ratings from JD Power and Consumer Reports to confirm that real-life customers were happy with their experience, particularly their insurer’s claims payment speed.
We combined this data with an overview of each insurer’s coverage and discount options, along with any special features, such as apps or safe driving programs. Our goal is to help you choose the best auto insurance for your unique needs, so use our provider evaluations as a guide — and consider requesting quotes from multiple insurers so you can make sure you’re getting the best coverage for the lowest price.
Alabama Auto Insurance Reviews
State Farm received an honorable mention in our nationwide auto insurance review — and it received an A++ financial stability rating from A.M. Best. State Farm’s Consumer Reports ratings: a “Very Good” for claims process and an “Excellent” for claims payment speed. However, its JD Power ratings were slightly lower, though still impressive: State Farm got a 3/5 for both overall and claims experiences.
State Farm offers standard coverage options, and it also offers rideshare coverage as an add-on to your personal policy rather than a separate insurance policy. Personal auto insurance doesn’t cover you when you use your car for commercial purposes, so adding rideshare coverage to your policy will ensure you stay covered during your Uber/Lyft shifts.
State Farm also offers a number of discounts, including most of the usual discounts: multi-line, multi-car, air bags, etc. You can get a discount for being a good student or a safe driver, and if you want to get an even bigger discount for your good driving habits, you can sign up for State Farm’s Drive Safe & Save program. Drive Safe & Save tracks your driving in real time through your mobile device or OnStar service, and if you drive safely, you can save money — up to a 50 percent discount on your premium!
Like State Farm, Progressive received an honorable mention in our nationwide auto insurance review. Progressive’s financial stability rating is slightly lower than State Farm’s — an A+ instead an A++, which is still very good. Like State Farm, Progressive received 3/5 for both overall and claims experiences from JD Power, and earned a “Very Good” for claims process and an “Excellent” for claims payment speed from Consumer Reports.
Progressive’s coverage package doesn’t include rideshare coverage, but it does include two coverages that none of our other insurers offer. Progressive’s collision insurance comes with pet injury coverage, to cover veterinary care expenses if your pet is injured in an accident. Progressive’s gap insurance — sometimes called loan/lease payoff insurance — helps cover the balance of your car loan if your car is totaled. (You don’t want to be on the hook for monthly car payments on a car that no longer exists, right?)
If you’re looking for discounts, Progressive’s list is a little shorter than our other providers but you can still get discounts for the usual stuff: multi-line, multi-car, good student, safe driver. Like State Farm’s Drive Safe & Save, Progressive’s Snapshot program also rewards good driving habits, and drivers can earn an average of $130 off their premium by letting Snapshot track their driving for a policy period (usually 6-12 months). However, you only get one shot with Snapshot — unlike Drive Safe & Save, you can’t improve your driving (and your discount) over time.
If you’re interested in adding Progressive to your quote list, you can earn an additional discount for starting your quote process online — so why not see how much you can save?
Like State Farm and Progressive, Allstate also received an honorable mention in our nationwide auto insurance review. Like Progressive, Allstate garnered an A+ financial stability rating from A.M. Best. JD Power only gave Allstate 2/5 points for overall experience, though it received 3/5 points for claims experience. Like our other top providers so far, Allstate received a “Very Good” for claims process and an “Excellent” for claims payment speed from Consumer Reports.
Allstate includes the most coverage options of any of our top providers — you can get both rideshare coverage and classic car coverage from Allstate, for example — but be aware that every additional coverage comes with an additional cost. Allstate also offers a special type of coverage called Deductible Rewards: purchasing this option will reduce your deductible by $100, and you’ll get an additional $100 off your deductible for every accident-free year you drive (up to $500 total). Since you have to pay off your deductible before you can claim any money from your insurer, this could be a good way to save money — as long as you drive safely.
Safe drivers should also sign up for Allstate’s Drivewise program, which — like Drive Safe & Save and Snapshot — tracks your driving in real time. With Drivewise, you can get up to 25 percent of your premium in cash back every six months. Good driving also earns you Allstate Rewards points that can be used to save money on top brands like Nike and Applebee’s.
Since Allstate includes so many coverage options and features, it might be worth it to get a quote. Be aware that your quote might be a little higher with Allstate — like Progressive, Allstate doesn’t offer a lot of discounts.
Alfa Insurance is a regional insurer that developed out of the Alabama Farmers Federation and now services 11 states. With an A rating from A.M. Best, Alfa has the lowest financial stability rating of any of our top providers; however, it received 3/5 for both overall and claims experiences from JD Power, putting it on par with State Farm and Progressive. Alfa is too small to get a rating from Consumer Reports, though.
Alfa doesn’t offer a lot of coverage options, though it offers two different coverages designed to protect you from lost wages. Alfa’s liability coverage includes payments of up to $50 per day when you are required to attend a trial or hearing at Alfa’s request (if, for example, you were to get into an accident where both parties ended up in court). You can also purchase loss of income coverage, which pays up to $750/month for a full year if you receive an accident-related injury that renders you unable to work.
Alfa’s discount package includes most of the typical discounts — multi-line, multi-car, anti-theft, air bags — as well as a few discount options designed for young drivers. Unmarried drivers aged 16-24 can receive a discount for good grades; unmarried drivers aged 16-20 can receive additional discounts for passing defensive driver tests. Any driver aged 16-20 can receive a discount for taking a driver’s education course, regardless of marital status.
You might be able to get more options from a larger insurer, but if you’re interested in working with a local provider, contact Alfa for a quote.
Be careful before buying a hail-damaged car.
Some Alabamians think they can save money by buying a hail-damaged vehicle — after all, a few dents and dings don’t affect the way the car runs, right? WRONG. Cars with hail damage on the outside often have water damage on the inside, so be wary before buying a damaged car in “as is” condition.
If you see a vehicle on the side of the road, move into the passing lane — or slow down.
Alabama’s mandatory insurance law isn’t the only legal change drivers should be aware of. In 2018, Governor Kay Ivey signed an expanded bill requiring Alabama drivers to pull into the passing lane if they see a vehicle with flashing or emergency lights on the side of the road. If it isn’t safe to pull into the passing lane — or if you’re on a two-lane highway with traffic going in both directions — you are required to drop your speed to 15 mph below the posted limit or drive 10 mph if the speed is 20 mph or below.