The Best Alabama Auto Insurance
In November 2017, Alabama passed a mandatory auto insurance law to fine drivers $200 or more if they’re caught without insurance. However, that’s not the only reason you’ll need car insurance in Alabama. The Yellowhammer State also ranks third in the nation for tornadoes and fifth in the nation for wildfires. It’s imperative that you insure your vehicle and, with insurance rates going up, you need to find the best auto insurance company for your needs.
How We Found the Best Alabama Auto Insurance
We evaluated the four largest auto insurance providers in Alabama using the same methodology we used for our nationwide auto insurance review. We also compared financial stability ratings from A.M. Best, 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.
The 4 Best Auto Insurance Companies in Alabama
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” rating for the claims process and an “Excellent” on claims payment speed. Its J.D. Power ratings varied by region with an impressive 4/5 in the New England, North Central, and Southwest regions for overall customer satisfaction. For the Southeast region that includes Alabama drivers, it received an “about average” 3/5 score.
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. This means that you can cover your personal vehicle if you use it for commercial purposes such as Uber or Lyft. State Farm also offers a number of discounts, including: multi-car, multi-line, airbags, accident-free, and good driving.
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% discount on your premium!
Progressive also 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 from Consumer Reports for the Southeast region in overall customer satisfaction and claims experiences from J.D. Power, and earned a “Very Good” for claims process and an “Excellent” for claims payment speed.
Progressive’s coverage package can also include rideshare coverage either as a personal auto policy endorsement or as a commercial for-hire auto policy. Uniquely, Progressive’s collision insurance also comes with pet injury coverage, to cover veterinary care expenses if your pet is injured in an accident. Its gap insurance—sometimes called loan/lease payoff insurance—helps cover the balance of your car loan if your car is totaled.
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: starting the quote process online, multiple policies, multiple vehicles, being a good student and being a 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.
Allstate garnered an A+ financial stability rating from A.M. Best, while J.D. Power gave Allstate 3/5 for overall customer satisfaction. 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 — although keep in mind 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 is a good way safe drivers can save money.
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% 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.
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 (although still a perfectly respectable) financial stability rating of our top providers. It also received 3/5 for both overall and claims experiences from J.D. 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 per 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.
Guide to Alabama Auto Insurance
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. When driving in Alabama, 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 (close to 12%), 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.
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? Unfortunately, no. 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.
Alabama Auto Insurance FAQ
What are average auto insurance rates in Alabama?
Alabama auto insurance rates are below the national average — $868 per year, compared to $1,009 nationwide. However, the rate you’ll actually pay could be higher or lower depending on your car, your zip code, and the coverage you choose. You can use our tool at the top of the page to find your best rates.
How much auto insurance do you need?
Auto insurance is crucial for drivers in Alabama — and not just the minimum 25/50/25. Due to the high number of uninsured drivers, Alabamians should also invest in comprehensive insurance To help you get the best price possible, you should request quotes from multiple providers and regularly review your policy to ensure you’re taking advantage of all available discounts.
The Best Alabama Auto Insurance: Summed Up
|A.M. Best Financial Strength Rating|
|J.D. Power Customer Satisfaction Score (Southeast Region)|
|Consumer Reports Reader Score|
|Safe Driving Discounts|
|Teen Driver Discounts|