Reviews Report
- Auto-Owners is our pick for the best overall home insurance company in Alabama.
- The cheapest home insurance company in Alabama is Cincinnati Insurance, with an average annual premium of $740.
- USAA is the best Alabama home insurance for military-focused coverage and for excellent customer service.
Homeowners insurance in Alabama is somewhat expensive. According to 2021 data from Bankrate.com, the average annual premium for home insurance in Alabama is $1,624, which is higher than the national average rate of $1,312. Although home insurance is not a legal requirement, it can be a good investment, especially due to the intense weather conditions that Alabama residents can experience.
There are plenty of home insurance companies operating in Alabama. To help you find the best coverage for your needs, we did some research and compared providers based on average premiums, coverage options, discounts, third-party ratings, and financial strength scores. The companies we found most compelling are Auto-Owners, Cincinnati Insurance, USAA, Allstate, and State Farm.
The 5 Best Homeowners Insurance Companies in Alabama
- Auto-Owners: Best Overall
- Cincinnati Financial: Best for Cheap Rates
- USAA: Best for Military-Focused Coverage
- Allstate: Best for Optional Coverages
- State Farm: Best for New Homeowners
Compare the Best Alabama Home Insurance Companies
| Average Premium* | Average Monthly Premium* | J.D. Power Customer Satisfaction** J.D. Power scores are based on surveys for customer satisfaction and product quality. | AM Best AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim. | Standard & Poor’s Standard & Poor’s (S&P) rates creditworthiness for businesses, countries and cities that issue bonds. | ||
|---|---|---|---|---|---|---|
| Pin Auto-Owners | $1,675 | $140 | 843 | A++ | N/A | |
| Pin Cincinnati Financial | $740 | $62 | N/A | A+ | A+ | |
| Pin USAA | $747 | $62 | 889 | A++ | AA+ | |
| Pin Allstate | $1,575 | $131 | 829 | A+ | AA- | |
| Pin State Farm | $1,484 | $124 | 829 | A++ | AA |
Information accurate as of September 2021
*Data provided by Bankrate.com
**J.D. Power’s 2020 Home Insurance Satisfaction Study. Based on a 1,000-point scale.
***Not official ranked by J.D. Power due to eligibility restrictions
Auto-Owners
Best Overall
Why we chose it
Why we chose it
Pros
- Excellent third-party reviews
- Great financial strength
- Wide variety of discounts
Cons
- No online quotes
- Above-average premium costs
- Limited online tools and resources
Available Discounts
- Multi-policy
- Payment history
- Paperless statements
- Protective devices
- Automatic backup generator
- Pay in full
- Life multi-policy
- Advance quote
- Water shutoff system
- No mortgage
- Claims-free
Additional Coverage
- Guaranteed home replacement cost
- Special personal property
- Homeowners plus package
- Identity theft coverage
- Equipment breakdown
- Law/ordinance
- Water back up
- Flood insurance
More Auto-Owners Insurance Reviews
Cincinnati Financial
Best for Cheap Rates
Why we chose it
Why we chose it
Pros
- Cheapest average premiums
- High-value home coverage
- Strong financial ratings
Cons
- No online quotes
- Fewer discounts than competitors
- Some coverages only available with high-value home policies
Available Discounts
- Multi-policy
- New home
- Claims-free
- Protective device
Additional Coverage
- Earthquake insurance
- Golf cart insurance
- Identity theft insurance
- Homeowner plus package
- Enhanced replacement cost
- Personal cyber protection
USAA
Best for Military-Focused Coverage
Why we chose it
Why we chose it
Pros
- Great customer service
- Competitive premiums
- Policies include replacement cost coverage
Cons
- Must be affiliated with the military to get coverage
- Not many discounts
- Few local office branches
Available Discounts
- Policy bundling
- Protective device
- Claims-free
Additional Coverage
- Home sharing insurance
- Identity theft coverage
- Earthquake insurance
- Flood insurance
- Military uniform coverage
- Valuable personal property coverage
More USAA Insurance Reviews
Allstate
Best for Optional Coverages
Why we chose it
Why we chose it
Pros
- Lots of discounts
- Many optional coverages
- Helpful website with several tools and resources
Cons
- High number of company complaints
- More expensive premiums than some competitors
- Below-average ratings for claims satisfaction
Available Discounts
- Claims-free
- Multi-policy
- Responsible payer
- Welcome and loyalty
- Home buyer
- Automatic payments
- Protective device
- Early signing
Additional Coverage
- Host Advantage insurance
- Identity theft restoration
- Water backup coverage
- Scheduled personal property coverage
- Business property coverage
- Sports equipment coverage
- Green improvement reimbursement
- Yard and garden coverage
- Electronic data recovery coverage
- Flood insurance
- Musical instruments coverage
More Allstate Insurance Reviews
State Farm
Best for New Homeowners
Why we chose it
Why we chose it
Pros
- Robust and user-friendly website
- Detailed online quotes
- Helpful tools and resources for first-time home insurance buyers
Cons
- Not many discounts
- Discounts are not available in every state
- Below-average claims satisfaction reviews
Available Discounts
- Multi-policy
- Home safety device
- Impact-resistant roof
Additional Coverage
- Replacement cost coverage
- Identity restoration coverage
- Water back up coverage
- Earthquake insurance
- Ordinance/law coverage
- Personal articles coverage
More State Farm Insurance Reviews
*Data provided by Bankrate.com
**J.D. Power’s 2020 Home Insurance Satisfaction Study. Based on a 1,000-point scale.
Average Cost of Home Insurance in Alabama
According to 2021 data from Bankrate.com, the average Alabama homeowners insurance premium is $1,624 per year, which is above average compared to the rest of the nation. The average annual home insurance premium in the United States is $1,312.
Alabama also has higher home insurance rates than some neighboring states. For example, the average cost of home insurance in Georgia is $1,376 per year, and the average cost of home insurance in Missouri is $1,558 per year.
However, it’s important to remember that home insurance quotes are personalized. You might pay more or less than average based on factors like your age, credit score, claims history, and your city and ZIP code. For instance, the cost of homeowners insurance in Mobile, AL, will be different than the average rate in Tuscaloosa, AL.
Average Premium from Homeowners Insurance Companies in Alabama
Using 2021 Quadrant Information Services data from Bankrate.com, we analyzed home insurance companies in the United States and compared the best homeowners insurance rates in Alabama. We found that the average premium for home insurance in Alabama is $1,624 per year. However, homeowners may be able to find cheap home insurance rates, like $740 a year with Cincinnati.
These are sample rates and should be used for comparative purposes only. Your quotes may be different.
The coverage limits in the methodology are as follows:
- Coverage A, Dwelling: $250,000
- Coverage B, Other Structures: $25,000
- Coverage C, Personal Property: $125,000
- Coverage D, Loss of Use: $50,000
- Coverage E, Liability: $300,000
- Coverage F, Medical Payments: $1,000
The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required).
Average annual premium for Alabama companies
| Cincinnati Insurance | $740 |
| USAA | $747 |
| Nationwide | $1,424 |
| Centauri Specialty Ins Co | $1,437 |
| State Farm | $1,484 |
| Allstate | $1,575 |
| Auto-Owners | $1,675 |
| Farmers | $1,805 |
| Travelers | $2,006 |
| Country Financial | $2,371 |
| Alfa | $2,438 |
Source: Bankrate.com
Top 3 Most Expensive Companies for Alabama Homeowners Insurance
| Company | Average Annual Premium | Average Monthly Premium |
| Alfa | $2,438 | $203 |
| Country Financial | $2,371 | $197 |
| Travelers | $2,006 | $167 |
Source: Bankrate.com
Top 3 Cheapest Companies for Alabama Homeowners Insurance
| Company | Average Annual Premium | Average Monthly Premium |
| Cincinnati Insurance | $740 | $62 |
| USAA | $747 | $62 |
| Nationwide | $1,424 | $119 |
Source: Bankrate.com
Alabama Home Insurance Considerations
Alabama homeowners face a number of different perils that could potentially damage or destroy their homes. Due to the state’s location near the Gulf of Mexico, hurricanes, strong winds, storm surges, and flooding are among the most common natural disasters to be aware of.
In the last 90 years, there have been nine major hurricanes to pass through Alabama, causing millions of dollars in damage. Tornadoes can also cause extensive damage to Alabama homes. Between 1950 and 2019, there have been 82 tornadoes that touched down in the state, according to the National Weather Service. Most tornadoes occur in the fall and winter months in Alabama.
Standard home insurance policies cover many of the most common losses that homeowners can face. However, home insurance policies don’t cover everything. It’s a good idea to review your policy declaration page to see exactly what is and isn’t covered. To fill gaps in your policy, Alabama homeowners may want to consider purchasing certain add-on coverages. Flood insurance is one of the most important. Many insurance providers sell flood insurance through the National Flood Insurance Program (NFIP), which is federally sponsored.
Other add-on coverages to consider are valuable items coverage, water backup coverage, and identity theft coverage.
Helpful Resources for Alabama Homeowners
If you still need help determining how much coverage and what type of Alabama home insurance coverage you need, here are some additional resources that can help you decide:
- Alabama Department of Insurance’s Consumer’s Guide to Homeowners Insurance
- Alabama Department of Insurance’s Commonly Asked Home Insurance Questions
- Alabama Department of Insurance’s Flood Insurance Information
Alabama Home Insurance FAQ
Methodology
We evaluated the companies based on their third-party agency ratings for customer experience, financial stability, as well as coverage options to determine which might be the best providers.
To compare home insurance companies across the board, we considered the following factors:
- Customer Ratings — Customer ratings are an indication of satisfaction with the process of filing a claim. We measured this using J.D. Power Homeowners Satisfaction ratings.
- Coverage — As there isn’t one company to fit everyone’s needs, we evaluated companies by the amount of coverage options and add-ons available.
- Confidence — It is extremely important for insurance companies to fulfill customers’ claims. Companies with sound financial strength will not have issues paying out claims, regardless of the amount. However, companies with weak financial strength might not be able to pay out claims. We measured this using AM Best’s ratings, which specializes in assessing the financial strength of insurance companies.
- Customer Experience — The amount of complaints a company receives is an indicator of the overall customer experience as it expresses dissatisfaction. We have based this measure on the NAIC National Complaint Index.
Rates are based on quoted annual premiums from Bankrate.com. These are sample rates and should be used for comparative purposes only. Your quotes may be different.
The coverage limits for home insurance rates reflect the following coverage and limits:
- Coverage A, Dwelling: $250,000
- Coverage B, Other Structures: $25,000
- Coverage C, Personal Property: $125,000
- Coverage D, Loss of Use: $50,000
- Coverage E, Liability: $300,000
- Coverage F, Medical Payments: $1,000
The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required).
About the Authors
Cate Deventer is a writer and licensed insurance agent. She has a Bachelor’s degree in theatre and is currently pursuing a degree in English with a concentration in professional and technical writing from Indiana University East. Her work has been featured on Reviews.com and Bankrate.com, and she’s passionate about helping people take charge of their finances. In her free time, she likes to read thrillers and sci-fi novels, garden, and toss tennis balls for her dog.
