To help you find the best car insurance in Alabama, MoneyGeek ranked the top providers based on affordability, J.D. Power customer service scores and AM Best's financial stability rating. Whether you want to find average costs for insurance in Alabama, need affordable coverage after a ticket or accident, or are looking for car insurance for teen drives, MoneyGeek’s rankings can help you find the best car insurance for your needs. MoneyGeek's ratings highlight a potential savings of more than $1,100 for drivers when comparing car insurance quotes from the top-rated companies in Alabama.
The Best Cheap Car Insurance in Alabama for 2021
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Cheapest Car Insurance Companies and Quotes in Alabama
MoneyGeek ranked the most affordable car insurance in Alabama based on carriers’ average annual rates for comprehensive and collision coverage with a clean driving record. However, individualized factors significantly affect the cost of auto insurance. It is best to compare quotes and average annual premiums from various insurance providers to determine how much your car insurance will cost.
Average Comprehensive and Collision Rates in Alabama
The listed prices are the annual premium costs for the average driver. The numbers may vary because insurance companies consider various factors to determine auto insurance costs in Alabama, including credit score, driving record and age. Most carriers have higher premiums for drivers with DUI records or prior speeding tickets. Many insurers offer discounts for younger drivers and individuals with good driving records. Shop around to find the best car insurance in Alabama for your needs.
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Cheapest Liability Car Insurance in Alabama
Some drivers choose liability-only car insurance. This coverage level insures you for the cost of medical expenses and damages to drivers in the other vehicle if you are at fault in an accident. Liability coverage does not cover your own medical or vehicle costs, so if you are still making payments on your car, it may be better to opt for comprehensive and collision coverage. Most states set a minimum liability requirement, and insurance companies also provide higher coverage levels to protect you in the event of an accident. In Alabama, GEICO provides the most affordable coverage for most drivers, whether they opt for the state minimum of 25/50/25 or select a slightly higher option with 50/100/50 coverage.
Average Cost for Liability Coverage
The Best Car Insurance Companies in Alabama for 2021
To determine the best car insurance provider in Alabama, MoneyGeek used a unique rating system based on affordability, claims experience, customer service and financial strength. Considering ratings from J.D. Power and AM Best, as well as industry-wide pricing data, MoneyGeek formulated the final scores out of 100.
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3
Auto-Owners Insurance CoScore: 90
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5
North Carolina Farm BureauScore: 87.5
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Market Share by Company
State Farm, Alfa and GEICO have almost 50% of the state’s market share: 23.73% for State Farm, 14.13% for Alfa and 10.84% from GEICO.
- CompanyMarket Share
- 1. State Farm23.7%
- 2. ALFA14.1%
- 3. GEICO10.8%
- 4. Allstate10.4%
- 5. Progressive8.0%
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What Is the Average Cost of Car Insurance in Alabama?
MoneyGeek defines the average driver as a 40-year-old man who drives a Toyota Camry with no speeding tickets or accidents. Using this information, MoneyGeek calculated the typical rates in the state. Individuals may have higher or lower annual premiums for auto insurance in Alabama, depending on the level of coverage, driving history and location, among other factors.
- Average Driver: $1,221
- DUI: $2,064
- Speeding Ticket: $1,483
- Poor Credit Score: $2,183
- Seniors: $1,260
- Students:$2,918
Cheapest Car Insurance for Drivers With a DUI in Alabama
According to the Centers for Disease Control and Prevention, 2,608 people were killed in crashes involving a drunk driver in Alabama from 2009–2018. The percentage of adults who reported driving after drinking too much (in the 30 days prior to being surveyed) was 1.5% in Alabama, according to 2018 CDC data.
The financial repercussions of getting a DUI are costly and can range from court and legal fees to alcohol education treatment programs. Additionally, car insurance rates after a DUI tend to be higher. Consider the following auto insurance rates for drivers who receive a DUI in Alabama.
Average Car Insurance Rates With a DUI
- CompanyAnnuallyMonthly
- 1. Allstate$1,150$96
- 2. USAA$1,290$108
- 3. State Farm$1,345$112
- $1,591$133
- 5. Farmers$1,639$137
While each insurance company calculates premiums differently, the costs of a DUI can set you back for years to come. You can expect to pay an additional $40,000 over the course of 13 years in increased auto insurance premiums. Exactly how much your rate would go up depends on your insurance company, your location and your driving record. With a DUI, you’ll likely pay higher rates for up to a decade or longer.
Cheapest Car Insurance With Tickets in Alabama
According to the National Highway Traffic Safety Administration’s (NHTSA) 2018 Fatality Analysis Reporting System (FARS), there were 876 crashes in Alabama because of distracted driving. Driving while distracted can cause accidents. Most states, including Alabama, have laws restricting distracted driving.
Average Car Insurance Rates With a Ticket
- CompanyAnnuallyMonthly
- 1. USAA$752$63
- 2. Allstate$945$79
- 3. GEICO$986$82
- $1,253$104
- 5. State Farm$1,345$112
Your auto insurance rate is likely to go up if you get a ticket for speeding or for distracted driving. According to the Insurance Information Association, your driving record is taken into account when you secure your auto policy, so being riskier to insure means paying higher premiums. Your insurer can also re-evaluate your rate if you get a moving violation (i.e., a speeding ticket).
Cheapest Car Insurance Companies in Alabama for Drivers With Bad Credit
According to Experian, the average FICO Score in the United States hit a record high of 703 in 2019, which is higher than the Alabama average FICO Score of 680. Many insurance providers use credit scores to determine premiums and predict insurance losses. If you have subprime credit (credit scores below 670), you’ll likely have to shop around to secure affordable car insurance in Alabama. While you may have to compare rates more thoroughly, you can still find affordable car insurance with poor credit.
Average Car Insurance Rates for Drivers With Bad Credit
While you may have to pay more for car insurance now if your credit is poor, improving your credit score can help lower your rates in the long run.
Cheapest Car Insurance Companies in Alabama for Seniors
According to 2017 National Highway Traffic Safety Administration data, there were 168 people aged 65 and older killed in motor vehicle traffic crashes in Alabama with older people making up 13.5% of all traffic fatalities during the year. When shopping for car insurance, seniors in Alabama should ask for discounts for completing driver safety courses, discounts for driving infrequently and discounts for choosing a vehicle that has good safety features.
Average Car Insurance Rates for Seniors
In Alabama, all drivers are required to renew their driver’s licenses in person and pass a vision test every four years.
Cheapest Car Insurance for Students in Alabama
It's common for parents to provide car insurance for their teen and college-aged kids. While parents can expect to pay more for insurance premiums for a younger driver, it is often more cost-effective to add your teen or college student to your policy rather than getting them their own policy. There are often discounts, such as those offered for good grades and for taking driving safety classes, that may be applicable, so it’s advisable to shop around to determine the best option.
Adding a teenage driver to a car insurance policy causes premiums to rise because insurers know teens are less experienced, take more risks and are more likely to be involved in fatal crashes, according to the National Highway Traffic Safety Administration.
In Alabama, there were 2,288 motor vehicle traffic fatalities in crashes that involved teen drivers ages 15–18 years old in 2016, according to the Alabama Department of Public Health.
The following table illustrates an estimation of what parents in Alabama can expect to pay for their teen or college-aged student drivers.
Average Car Insurance Rates for Students
- CompanyAnnuallyMonthly
- 1. GEICO$1,402$117
- 2. Allstate$2,498$208
- 3. Progressive$3,199$267
- 4. Nationwide$3,739$312
- 5. State Farm$4,105$342
Insurance Rate Information for Military Drivers and Veterans
Veterans and the more than 11,900 active-duty military personnel living in the state can expect discounts on car insurance exclusively for them, and typically for their spouses as well. Although non-residents are not required to register their vehicles while stationed in Alabama, they must still carry the state's required minimum coverage, so it’s worth it to shop around for a military discount.
Many companies licensed to sell auto insurance in Alabama also offer discounts for buying two or more policies, such as auto and homeowners, so veterans and active members of the military can save even more for bundling policies. One such company is USAA, which offers services exclusively to members of the military, veterans and their family members. Visit the Alabama Department of Insurance for benefits available to military personnel and veterans.
Disabled Alabama veterans who own a vehicle that was financed through the Veterans Administration are exempt from registration and taxes on the vehicle, though insurance is still mandatory. The following table showcases estimates for veterans in Alabama who are looking for auto insurance.
Average Rates for Alabama service members
25 years$1,199
50 years$1,066
50 years$1,066
25 years$1,105
50 years$1,050
50 years$1,050
Car Insurance in Alabama: What You Need to Know
Alabama’s minimum auto insurance requirements dictate that any registered vehicle must have liability insurance (or other proof of financial responsibility). Some vehicles that are exempt from the law include trailers, government-owned vehicles and vehicles covered under a commercial automobile liability insurance policy.
Proof of Insurance in Alabama
Alabama drivers must carry some proof of insurance, usually an insurance card, that must stay in the car at all times.
Cards should have the following information:
- The car's make, model, year and vehicle identification number
- The name of the insured person
- The insurance company name and its National Association of Insurance Commissioners code
- The policy number (except for temporary cards) and the dates for which it is active
Drivers have to show evidence of Alabama auto insurance on at least three occasions:
- If a law enforcement officer asks to see a license during a traffic stop (not doing so is a misdemeanor)
- When the state registers your vehicle (they will not renew the registration without proof of liability insurance)
- If you’re in an accident, you'll need to share your information with the other party
If you're not carrying your insurance card, the Alabama Administrative Code allows you to show the same proof digitally.
Minimum Liability Insurance Requirements in Alabama
Alabama requires this level of liability insurance for all drivers:
- $25,000 for death or bodily injury to one person
- $50,000 for death or bodily injury to two or more persons
- $25,000 for damage or destruction of property
Keep in mind that this is the bare minimum coverage required by law, and most drivers will need more insurance to be adequately protected.
Alternatives to Insurance in Alabama
There are only two legal alternatives to auto insurance in Alabama, and neither one is cheap. The first is a motor vehicle liability bond for at least $50,000, filed with the Department of Revenue through a surety company. The second is a cash deposit with the state treasurer for the same amount.Drivers who opt for the former will receive a motor vehicle liability bond certificate, while those who get the latter will receive a cash bond certificate. Copies of these certificates must be carried in the car, just like proof of insurance.
The advantage of surety bonds is that holders only need to put down a portion of the total, anywhere from 1–15%, depending on their credit. The disadvantage is that they are still responsible for paying the full amount if they are at fault in an accident. Meanwhile, drivers holding a cash bond that does not meet the full cost of an accident have just 30 days to come up with the remainder.
How Much Coverage Do You Need in Alabama?
While the state has a $25,000/$50,000 policy minimum, industry experts generally recommend getting at least $100,000/$300,000 worth of coverage. In other words, it's wise to stay away from the cheapest car insurance option.Experts also advise that getting collision and comprehensive coverage is a good idea for all cars worth more than $1,000. Collision coverage will pay to repair or replace your car if you're in a crash (provided it's worth more than the deductible), and comprehensive insurance will cover non-traffic disasters like fire, robbery, floods and hurricanes.
Given Alabama's high rate of uninsured drivers, people should also consider purchasing uninsured motorist coverage, which covers them when the other driver doesn't have enough insurance to cover the cost of an accident (or if they're the victim of a hit-and-run accident).
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Expert Advice on Finding Cheap Car Insurance in Alabama
To help you find reliable and accurate information on car insurance in Alabama, MoneyGeek collected expert advice from trusted professionals. The views and opinions expressed are those of the individual contributor.
- What are the key factors drivers in Alabama should look for when searching for reliable and affordable coverage?
- What natural or environmental factors should drivers in Alabama consider when shopping for the best car insurance coverage?
- How do regulations and rules in Alabama impact insurance pricing and how consumers might shop for coverage?
Dr. James BarthLowder Eminent Scholar in Finance at Auburn University
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About the Author
sources
- Alabama Department of Revenue, Motor Vehicle Division. "Alabama Mandatory Liability Insurance Law." Accessed March 2, 2020.
- Alabama Department of Insurance. "Automobile Premium Comparisons." Accessed March 2, 2020.
- Centers for Disease Control. "Sobering Facts: Alcohol-Impaired Driving State Fact Sheets." Accessed December 15, 2020.
- Experian. "2019 Consumer Credit Review." Accessed March 3, 2020.
- Insurance Information Institute. "Auto Rate Setting." Accessed March 2, 2020.
- National Association of Insurance Commissioners. "Market Share Reports for Property/Casualty Groups and Companies." Accessed March 2, 2020.