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.
bestauto insuranceAlabama2021The Cheapest and Best Car Insurance in Alabama
Cheapest for minimum liability - GEICO
Cheapest for full coverage - GEICO
Best company overall - Auto-Owners Insurance Co
Cheapest for drivers with a DUI - Allstate
Cheapest for drivers with a ticket - Allstate
Cheapest for senior drivers - GEICO
Cheapest for student drivers - GEICO
Car insurance prices in Alabama are calculated based on various personalized factors. The most affordable auto insurance in Alabama is minimum liability coverage, which meets the state’s minimum car insurance requirements.
The cheapest providers for minimum liability coverage in Alabama are:
- USAA: $304 per year (this coverage is only applicable to former and current military members and their families)
- GEICO: $375 per year
MetLife is the most costly insurer in the state for minimum liability coverage, with an average premium of $971 per year.
Average Cost for Minimun Liability Coverage
- CompanyAnnuallyMonthly
- 1.$304$25
- 2.$375$31
- 3.$494$41
- 4.$498$42
- 5.$562$47
These costs are estimates for the average driver in Alabama and may vary for each driver based on various factors. Comparing quotes between providers can help you determine how much you will pay for your car insurance coverage.
These prices are only estimates based on rates for an average Alabama driver and should not be used to compare insurance prices.
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For Alabama drivers, the minimum coverage policy only provides bodily injury and property damage protection. It does not cover personal medical expenses or vehicle damage costs. If you need an insurance plan that covers these costs, you can opt for a full coverage policy.
Getting a full coverage policy in Alabama grants you access to higher liability limits, as well as collision and comprehensive insurance coverage that protects you against a majority of road accidents and off-road incidents.
Although full coverage rates are significantly higher than the minimum liability coverage costs, the policy also covers damages to your car in case of an accident. By comparing car insurance quotes from different companies, you can find the best rates within the state.
MoneyGeek discovered that the cheapest providers of full coverage auto insurance in Alabama are:
- USAA: $677 per year (only available for military members, veterans and their families)
- GEICO: $827 per year
The company with the highest full coverage premium is Nationwide. Drivers with this policy pay an average of $1,814 per year.
Average Comprehensive and Collision Rates in Alabama
- CompanyAnnuallyMonthly
- 1.$677$56
- 2.$827$69
- 3.$846$71
- 4.$1,033$86
- 5.$1,059$88
The prices indicated above are estimates of the annual full coverage insurance costs for an average driver. The rates are for comprehensive and collision insurance with $100,000 in bodily injury liability coverage per person, bodily injury liability coverage of $300,000 per accident and $100,000 for property damage per accident.
The Best Car Insurance Companies in Alabama for 2021
According to research conducted by MoneyGeek, the best car insurance companies in Alabama for most drivers are:
- Best Overall: Auto-Owners
- Runner-up: ALFA
USAA received the highest score in Alabama by MoneyGeek's rating system. However, because USAA is only available to military members, veterans and their families, it is not listed as best overall.
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.
1
USAA
Score:95
USAA leads the list of top car insurance providers across Alabama. Customers trust USAA when it comes to processing claims, offering affordable services and providing excellent customer satisfaction. However, it is exclusive to current or former military members and their families.
More About USAA
Not only does USAA remain the best car insurance company in the country, but it is also the most affordable option in Alabama. Drivers who have a USAA policy can get a discount if their parents also have USAA. Drivers who are actively serving in the military and store their cars on base also enjoy outstanding rates.
Read MoneyGeek's USAA auto Insurance Review2
Auto-Owners Insurance Co
Score:90
Auto-Owners also stands out as one of the providers with high customer satisfaction and affordability scores. Using this insurer, Alabama residents can get their collision deductible waived should they get involved in an accident with a fellow Auto-Owner policyholder.
More About Auto-Owners Insurance Co
Auto-Owners offers a collection of additional optional car insurance coverages in Alabama that protect you from incidents such as rekeying locks, identity theft and replacing your damaged or lost cell phone. Policyholders are also entitled to 24/7 roadside service.
Read MoneyGeek's Auto-Owners Insurance Co auto Insurance Review3
ALFA
Score:88
4
GEICO
Score:85
5
State Farm
Score:83
6
Nationwide
Score:80
7
Travelers
Score:80
8
Progressive
Score:78
9
Safeco
Score:78
List of the Largest Insurance Companies in Alabama
Based on market share scores, the three biggest insurance companies in Alabama are USAA with a market share of 23.7%, Alfa with 14.1% and GEICO with 10.8%.
An insurer’s market share represents the percentage of all insurance policies in the state underwritten by that company. Insurance providers that feature a high market share often have strong financial stability and tend to settle claims reasonably and efficiently. However, this does not mean that they will be the best choice for all drivers.
- CompanyMarket Share
- 1.23.7%
- 2.ALFA14.1%
- 3.10.8%
- 4.10.4%
- 5.8.0%
How to Compare Cheap Alabama Car Insurance Quotes Online
Most car insurance providers in Alabama have a section on their website where customers can request a quote.
- While shopping for the best car insurance in Alabama, comparing quotes from different insurers can help you find the best rates for specific limits. For instance, if you request a quote for comprehensive and collision insurance with a $1,000 deductible from one provider, ensure that you use the same numbers when making comparisons with other insurers.
- You can provide your ZIP code below to compare quotes within Alabama or use the MoneyGeek price data to identify the best car insurance companies to contact.
- USAA, GEICO and Country Financial offer the best car insurance rates in Alabama for a minimum liability coverage policy.
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
Alabama drivers with a history of violations like a DUI are considered high-risk by insurance companies and pay more than drivers with a clean record. On average, the cost of car insurance for a driver with a clean record is about $1,221 per year, while a driver with a DUI pays roughly $2,064 for the same coverage.
The cheapest providers of full coverage car insurance for drivers with a DUI in the state are:
- Allstate: $1,150 per year
- USAA: $1,290 per year (only available for military members, veterans and their families)
While GEICO ranks as the second-cheapest full coverage provider for drivers with a clean record, Allstate often offers better rates for drivers with a DUI.
Average Car Insurance Rates With a DUI
- CompanyAnnuallyMonthly
- 1.$1,150$96
- 2.$1,290$108
- 3.$1,345$112
- 4.$1,591$133
- 5.$1,639$137
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.
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.
In Alabama, small violations such as speeding tickets attract higher insurance rates than the $1,221 average paid by residents with a clean driving record. If you have a speeding ticket, you will pay approximately $1,483 on average per year, which is $262 more.
The cheapest auto insurance providers in Alabama for full coverage with a speeding ticket are:
- USAA: $752 per year (only available for military members, veterans and their families)
- Allstate: $945 per year
Allstate provides the best rates for non-military drivers in Alabama, but GEICO is close behind, at $986 per year on average.
Average Car Insurance Rates With a Ticket
- CompanyAnnuallyMonthly
- 1.$752$63
- 2.$945$79
- 3.$986$82
- 4.$1,253$104
- 5.$1,345$112
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.
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).
Alabama drivers with bad credit scores pay almost twice as much for auto insurance as drivers with strong credit. The average cost of car insurance for drivers with good credit is $1,221 per year, while the cost for drivers with bad credit is $2,183 per year.
The top two auto insurance companies in Alabama offering the best full coverage rates for drivers with poor credit are:
- USAA: $1,126 per year (only available for military members, veterans and their families)
- GEICO: $1,208 per year
USAA and GEICO are also the cheapest insurers for drivers with a clean record.
Average Car Insurance Rates for Drivers With Bad Credit
- CompanyAnnuallyMonthly
- 1.$1,126$94
- 2.$1,208$101
- 3.$1,408$117
- 4.$1,443$120
- 5.$1,727$144
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.
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.
Car insurance companies in Alabama charge more for seniors than they do for middle-aged drivers and young adults. On average, seniors within the state get charged $1,260 per year instead of the $1,221 paid by other drivers.
The cheapest providers in Alabama for senior drivers with full coverage are:
- USAA: $709 per year (only available for military members, veterans and their families)
- GEICO: $878 per year
The next-best options behind GEICO are Allstate ($923) and Country Financial ($974).
Average Car Insurance Rates for Seniors
- CompanyAnnuallyMonthly
- 1.$709$59
- 2.$878$73
- 3.$923$77
- 4.$974$81
- 5.$1,162$97
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.
In Alabama, all drivers are required to renew their driver’s licenses in person and pass a vision test every four years.
Student drivers pay more for auto coverage than adults in Alabama due to their lack of experience. If you are a student driver, you will pay an average of $2,918 per year, which is more than double what a 40-year-old driver pays for similar coverage.
Overall, the cheapest insurers in Alabama for student drivers with full coverage are:
- GEICO: $1,402 per year
- Allstate: $2,498 per year
While USAA offers the cheapest full coverage options for an average 40-year-old driver, GEICO is the most affordable option for students.
Average Car Insurance Rates for Students
- CompanyAnnuallyMonthly
- 1.$1,402$117
- 2.$2,498$208
- 3.$3,199$267
- 4.$3,739$312
- 5.$4,105$342
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 above table illustrates an estimation of what parents in Alabama can expect to pay for their teen or college-aged student drivers.
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).
Average Insurance Rate by City in Alabama
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- CityAnnuallyMonthly
- 1.$1,221$102
- 2.$1,125$94
- 3.$1,236$103
- 4.$1,181$98
FAQs About Car Insurance in Alabama
Most of the questions asked about car insurance in Alabama are related to the rates and coverage options. Here are some of them:
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?
- What steps can drivers in Alabama take to find affordable car insurance?
Dr. James Barth
Lowder Eminent Scholar in Finance at Auburn University
Iverson Gandy, Jr., JD
Assistant Professor, Brimmer College of Business and Information Science at Tuskegee University
Mandy Harrelson
Program Champion Department of Finance, Harbert College of Business at Auburn University
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.