You are using an older browser version. Please use a supported version for the best MSN experience.

The Best Car Insurance Companies in Alabama

Bankrate logo Bankrate 1/20/2021 Grace Kim
a view of a city: view of Mobile, Alabama skyline © Steve Whiston – Fallen Log Photography/Getty Images view of Mobile, Alabama skyline

The highways and byways of Alabama lead to amazing adventures, from Huntsville's U.S. Space and Rocket Center to the emerald green waters of Gulf Shores. But before you set out on the open road, you need to protect yourself and your vehicle with Alabama auto insurance.

Based on the U.S. Department of Transportation, Alabama had nearly four million licensed drivers in 2018. The Alabama Department of Transportation "ALDOT" reports that a traffic accident occurred every 197 seconds in 2018, so it makes sense to protect yourself with automobile insurance.

When you are ready to shop for an Alabama insurance company, follow the advice of the Insurance Information Institute and National Association of Insurance Commissioners:

  • Research insurance rates for the make and model of vehicle you want to buy before you make a purchase.
  • Contact as many insurance companies as possible to compare rates.
  • Inquire about discounts that can lower your premium.
  • Contact your homeowners or renters insurance provider to find out if you can save money by bundling existing coverages with a car policy.
  • Ask insurance agents if your credit rating will affect your insurance rate.
  • If you own an older vehicle, consider discontinuing high-cost coverages such as comprehensive and collision.
  • Consider raising deductibles to reduce your premium.
  • When discussing policies with insurance agents, find out what each policy covers and its maximum limits.

The Best Car Insurance Companies in Alabama

Marketing research company J.D. Power conducts an annual study of car insurance companies to determine which ones offer the best coverage, prices and service. The survey rates insurance companies using a points system, which focuses on how providers perform in the billing process and policy information, claims handling, customer interaction, policy offerings, pricing and overall customer satisfaction. In J.D. Power's 2020 U.S. Auto Insurance Study, the top car insurance companies in the southeast region included:

  1. Farm Bureau Insurance of Tennessee
  2. Erie Insurance
  3. Alfa Insurance
  4. Geico
  5. Auto-Owners Insurance

Although USAA earned high marks in the survey, it technically does not qualify for J.D. Power's ranking, because it only provides insurance products for military members and their families. Nonetheless, for those who qualify, USAA offers a great option for Alabama auto insurance.

RankJ.D. Power RankingsAverage Full Coverage Premium
Farmers#1832 $1,914
USAA-909$1,262
Allstate#2846$1,914
Progressive#3848$1,536
Geico#4857$1,375
State Farm#5835$1,262

Farmers

J.D. Power ranks Farmers as one of the best car insurance companies in Alabama for customer satisfaction. Although the auto coverage is quite high at $1,914, the company offers several discounts, including safe driving, good student and bundling savings. Farmers also has an average Better Business Bureau rating of Good.

USAA

USAA technically tops the list in customer satisfaction with 909 points. It doesn't earn first place because Alabama auto insurance isn't available to everyone with this carrier. Membership is reserved for active military, veterans, retired military and their families. If you can qualify for membership, you'll have access to the highest-rated car insurance in Alabama.

Allstate

Allstate is one of the highest ranked insurance companies within the U.S. It is known for its 24/7 claims center and claims process. Although the car insurance company doesn't offer the cheapest car insurance in Alabama, drivers select Allstate for its other offerings such as claims satisfaction guarantee, coverage options, add-ons, and bundling policy. Alabama drivers can also depend on local experts to help with providing quotes and submitting claims.

Progressive

Progressive is known for outstanding customer service with a J.D. Power Score of 848 and offers an average rate of $1,536 annually for full coverage. Progressive is a good choice for drivers who may want 24/7 customer support, unique coverage options, and multiple ways to save with discounts.

Geico

Geico may offer some of the best car insurance rates in Alabama. In addition to offering one of the cheapest average rates for car insurance in Alabama, Geico also offers a list of discounts to choose from that will help you save even more money on your car insurance. Some of the best discounts include up to 25% off for an accident-free history and up to 15% savings on new car insurance.

State Farm

As one of the largest car insurance providers in the U.S., State Farm is a popular choice for drivers seeking car insurance in Alabama. With its A+ BBB rating, high financial strength, and high J.D. Power ranking, State Farm makes the list of one of the best car insurance companies in Alabama. In terms of price, State Farm offers affordable rates at an average of $1,446 for full coverage car insurance in Alabama. While it may not be the cheapest on the list, Alabama drivers can apply any of the insurance firm's list of discounts such as the Drive Safe, Steer Clear, Good Student, and others to bring the total down.

Average Car Insurance Cost in Alabama

Alabama automobile owners pay an average annual car insurance premium of $434 for minimum coverage and $1,672 for full coverage. When compared with the national average of $1,738 for full coverage, Alabamans pay slightly less than drivers in other states.

State Minimum Insurance Requirements in Alabama

All states require drivers to carry minimum coverage. Alabama's requirement for auto owners is a minimum amount of liability car insurance. In Alabama, you must purchase:

  • At least $25,000 bodily injury liability to cover the medical or death expenses of one person in a single accident.
  • A minimum of $50,000 bodily injury liability to pay the medical or death expenses of more than one person in a single traffic accident.
  • At least $25,000 property damage liability to pay for damage caused in a single collision.

Alabama's No-Fault Law

Alabama does not have a no-fault law. The state is considered an at-fault state. This means that the insurance of the driver who causes the accident is required to pay for any collision bills of the other driver involved in the accident. To determine who is at fault, drivers must collect a police report and pictures of the accident and submit a claim for insurance companies to investigate the damages done to the vehicles.

Car Insurance Discounts in Alabama

Inquiring about discounts can save you big bucks on Alabama insurance. Most insurance companies in Alabama offer a variety of ways to reduce your premium, including programs which reward you for education, loyalty and safe driving.

All companies discount policyholders for safe driving, good student discounts and prepaying or setting up automatic payments for your premiums. In addition, Alfa Insurance policyholders enjoy numerous policy-related discounts, including:

  • Multi-car discounts for policyholders who insure two or more passenger cars with Alfa.
  • Life insurance discounts for auto policyholders who purchase Alfa life insurance coverage.
  • Combo discounts for auto policyholders who also have an Alfa homeowners policy.

USAA offers loyalty rewards and discounts geared to military life such as:

  • Family discounts up to 10% for the kids of military members who continue their USAA auto insurance into adulthood.
  • Longevity discounts for members who continuously renew their USAA car Alabama insurance policies.
  • Military installation discounts up to 15% for policyholders who store their vehicles in military base garages.

Frequently asked questions

What is the cheapest car insurance in Alabama?

Factors such as your age, credit history and vehicle make and model play a role in how insurance companies determine your rate. For the best rate possible, you must shop around.

What information is needed in order to get car insurance in Alabama?

When you contact Alabama insurance companies, agents will need to know the type of car you want to insure, your age, where you live, your annual mileage and information about your driving record.

Does Alabama require car owners to purchase no-fault insurance?

Alabama requires minimum amounts of liability insurance but does not require car owners to purchase no-fault insurance.

Can I save money by adding my teenager to my insurance policy, rather than purchasing separate coverage?

Alabama teenagers pay exorbitantly high car insurance rates. Oftentimes, you can save your teenager thousands of dollars per year by adding them to your existing automobile policy.

Methodology

Bankrate utilizes Quadrant Information Services to analyze rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a cleaning driving record, good credit and the following full coverage limits:

  • $100,000 bodily injury liability per person
  • $300,000 bodily injury liability per accident
  • $50,000 property damage liability per accident
  • $100,000 uninsured motorist bodily injury per person
  • $300,000 uninsured motorist bodily injury per accident
  • $500 collision deductible
  • $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverages that meet each state's requirements. Our sample drivers own a 2018 Honda Accord, commute five days a week and drive 12,000 miles annually.

These are sample rates and should be used for comparative purposes only. Your quotes may be different.

AdChoices
AdChoices
image beaconimage beaconimage beacon