Alabama Auto Insurance - Your Guide to Insuring Your Car

YOUR COMPREHENSIVE GUIDE TO AUTO INSURANCE (Huntsville, AL)

All drivers in Alabama including Auburn, Birmingham, and Huntsville need the minimum 25/50/25 liability auto insurance coverage, which can cost as low as $24 per month or $291 per year.

Across the Cotton State, there are approximately 210,531 miles of road just waiting to be driven. We’ll guide you on how to buy the best and cheapest car insurance in Alabama, then you take the wheel.

Alabama car insurance can provide Alabamans with financial protection in the event their vehicle is damaged, lost, or stolen and injury in an accident.

The average auto insurance rate in Alabama is $ $1,719 (full coverage) per year — that's around 67% cheaper than the national average of $2,545 per year.

However, these numbers can spiral out of control for Alabama drivers with an accident or DUI — roughly 45% more than those with a clean record.

Our car insurance quotes are incredibly specific and comprise many factors including the type of vehicle, driving record, and location—right down to your ZIP code.

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Key Takeaways: Alabama Auto Insurance Coverage

• The legal minimum liability auto insurance coverage in Alabama is 25/50/25.
•  Alabama is an at-fault state.
• Penalties for driving in Alabama without car insurance include a $500 fine and jail time.
• You can expand your auto insurance coverage with additional coverage options.
• Many drivers in Alabama believe they have auto insurance coverage that doesn’t exist such as accidental death and dismemberment (AD&D) insurance.

Get in touch with an expert URChoiceInsurance advisor today for a customized car insurance quote. Interlink to quote form.

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Components of an Auto Insurance Policy in Alabama

Insurance jargon may be a bit overwhelming for the average consumer, but here are a few key components you need to understand.

Premium – the premium is the amount you agree to pay for auto insurance in Dothan, Tuscaloosa, Montgomery, Madison, and any other city in Alabama. It is usually the same amount as the quote you receive from us.

Deductible – a deductible is the amount you pay when you file an auto insurance claim for certain types of Alabama car insurance.

Coverage Amounts – the amount your auto insurance company will pay according to your policy limits.

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Types of Car Insurance in Alabama

Whether you’re purchasing a new car or shopping around for inexpensive auto insurance in Auburn. Mobile or any other city in Alabama, it is important to understand the types of coverage available.

Liability Car Insurance Coverage

Liability auto insurance pays for costs stemming from any accidents that are your fault. If the other party needs medical attention or has sustained property damage, your Alabama auto insurance liability coverage will cover their damages.

According to the Alabama Law Enforcement Agency, operating, registering, or maintaining registration of a motor vehicle designed to be used on a public road or highway is strictly prohibited unless it is covered by a liability insurance policy.

Collision Car Insurance Coverage

Collision car insurance covers repairs and damages to your vehicle while driving.

For example, if your vehicle collides with another object such as a building or a tree, and your windshield is damaged, collision coverage will apply, even if you’re at fault. Collison auto insurance coverage also covers damage to your vehicle caused by potholes.

Comprehensive Car Insurance Coverage

Collison and comprehensive car insurance are often confused with each other but they’re distinctly different.

Alabama comprehensive auto insurance does not cover any accident-related damage done to your vehicle, for which you should get collision car insurance coverage.

Comprehensive coverage pays for damages to your vehicle that are caused by an event that’s not car accident-related such as losses from hail damage or when a deer jumps in front of your car while driving, and also may reimburse you if your car is stolen.

Even though collision and comprehensive insurance are optional in Alabama, drivers in Alabama are encouraged to buy them both when appropriate.

Personal Injury Protection (PIP)/Medical Payments Coverage

Often referred to as no-fault insurance, personal injury protection (PIP) is mandatory coverage in no-fault states including Florida and New York.

Alabama however is an at fault state, which means that motorists who cause an accident are responsible for compensating the injured party.

Since PIP is not required and is not even available in a tort state like Alabama, medical payments (MedPay) is a great alternative.

Regardless of who is at fault in the event of an accident, both MedPay and PIP will cover medical expenses for you, your passengers, household members, and drivers listed on your policy.

Another big reason MedPay is a good substitute for PIP is it can cover deductibles, and certain expenses that your health insurance does not cover such as funeral expenses.

PIP goes above and beyond MedPay and covers lost wages if you can’t work due to accident injuries, replacement services including housekeeping, and is sold in larger amounts, depending on your state.

MedPay is a great optional add-on to your existing car policy and usually costs less than $10 per month on top of your existing premium.

Uninsured Motorist Coverage (UM)

When driving to work or running errands, you’re likely on the roadway with motorists driving with no car insurance.

Uninsured motorist coverage (UIM) is a type of car insurance coverage in Alabama that can pay for medical expenses if you or your passengers are injured in an accident caused by:

• A hit-and-run driver
•  Driver without any liability car insurance
• ·Driver whose insurance company denies coverage

UM auto insurance in Birmingham, Tuscaloosa, Hoover, Vestavia Hills, and other cities in Alabama can pay for medical bills, lost wages if you can’t work because of the accident, and funeral costs.

Uninsured auto coverage is offered as part of every policy including the cheapest auto insurance in Alabama.

We recommend buying uninsured motor insurance coverage of at least $100,000, The average cost of UM premiums ranges from $86 to $134 per year.

Underinsured Motorist Coverage (UIM)

Some drivers buy the absolute minimum amount of insurance coverage in Alabama, which according to the Alabama Department of Revenue is “$25,000 bodily injury/person/accident. $50,000 combined bodily injury/accident. $25,000 property damage/accident or a combined single limit of $75,000/accident”.

Therefore, if you are hit by a driver who does not have enough cover to pay for the injuries to you and your passengers, you can use your UIM insurance coverage to pay for the damages over and above the other driver’s Alabama auto liability insurance coverage.

UIM coverage is one of the cheap car insurance coverages in Huntsville, Athens, Bessemer, and the cities in the Yellowhammer State, and costs somewhere between $33 to $76 per year.

Stacked vs. Unstacked Alabama Auto Insurance  

When shopping for affordable car insurance quotes in Alabama, you will probably hear the term insurance stacking crop up often.

Stacked insurance typically applies to uninsured and underinsured car insurance coverages and is available in certain states including Alabama.

Simply put, stacked car insurance means that you can combine (stack) coverage limits for multiple vehicles, either horizontally (across multiple policies) or vertically (within one policy).

Think about stacking (vertical) as the total of your uninsured/underinsured motorist coverage limit, multiplied by the number of vehicles on your Alabama car insurance policy.

Horizontal stacked insurance coverage allows you to combine uninsured and underinsured coverage limits for vehicles that are a part of the same household if your name is on both policies.

There are only 10 states that permit horizontal stacking and Alabama doesn’t make it to that list.

Stacking is a great way to avoid unexpected bills after an accident but the downside to this combined coverage is that you pay a higher Alabama auto insurance premium.

Contrarily, unstacked car insurance coverage protects you up to your UM/UIM policy's per-car or per-policy limits, and no more.

GAP Insurance in Alabama

Guaranteed asset protection insurance is an optional add-on coverage that can prove extremely beneficial for motorists in certain situations.

GAP Alabama auto insurance does just that—bridges the gap between the financed amount owed on your car and your vehicle’s actual cash value (ACV) in the event your car is declared a total loss.

Many of our clients ask if GAP insurance covers auto theft in Alabama and the short answer is “Yes”, but only pays the difference between your actual car’s value and the amount you still owe.

GAP insurance however does not cover deductibles but is good to have if you owe more than what your car is worth.

Adding GAP insurance to your comprehensive and collision coverage generally increases your annual premium by about $20.

The cost of GAP insurance in Alabama depends on whether you buy it from a car dealership, or URChoiceInsurance, and can be as low as $8 per month.

Rental Reimbursement Coverage

If your car is in the shop due to repair after an accident, it could take several days or weeks until it's fixed.

In the meantime, you could be spending cash every day on collision-related rentals, which could add up quickly.

Rental reimbursement coverage is designed to keep you moving when your vehicle it undergoing repair, even if you are at fault in a covered accident in Alabama.

This optional auto insurance coverage may also apply to vehicles you don’t own that are involved in a covered accident such as a car you rented for a family trip.

Rental reimbursement coverage only lasts while your vehicle is at the repair shop or is deemed unsafe to drive due to an accident or another covered loss, not for routine maintenance or leisure.

This type of auto insurance coverage in Huntsville, Mobile, and other cities in Alabama usually requires collision and comprehensive coverage added to your policy.

Rental reimbursement coverage in Alabama is typically priced between $30 and $60 on top of your comprehensive/collision coverage policy.

Roadside Assistance

Roadside assistance coverage is geared towards assisting with unexpected problems on the road—-think locking your keys in your car, or overlooking that “E” sign on your fuel gauge.

In the event you experience any vehicle trouble on the road, contact your roadside assistance provider by calling the helpline or through the app.

Roadside assistance coverage varies across auto insurance providers in Alabama but most cover common reasons for breakdown including a dead battery and a tow to a nearby repair location, usually up to $200.

In addition to assisting with things such as changing a flat tire or towing services, some of the best roadside assistance plans in Alabama offer a few extra benefits such as trip interruption coverage and legal defense reimbursement.

Non-Owner Car Insurance

If you own a car, you need car insurance, but if you want to drive someone else’s vehicle, you can buy non-owner car insurance to avoid financial risk.

For folks who often borrow, rent, or share a car, or are required to show proof of car insurance such as an SR-22, a non-owner insurance policy may be a worthy investment.

This type of car insurance policy in Alabama typically provides basic liability for bodily injury and property damage when you are at fault in an accident.

Non-owner car insurance however doesn’t cover damage to the car you’re driving, injuries you suffer in an accident, other drivers, and if you’re driving for work purposes such as delivering goods to a client.

It is a “named” insurance” policy, meaning that only the person listed on the policy is covered. However, a few car insurance companies in Alabama may apply coverage to both you and your spouse.

How Much is Car Insurance in Alabama?

We consider several factors when determining the best car insurance rate in Alabama, most notably:

• Age
• Driving record
•  Gender
• Vehicle type
• Location
• Credit history
• Vehicle use (e.g., commuting to/from school or work)

Adding to this, the cheapest auto insurance rate in Alabama also depends on the type of coverage and limits you choose.

Minimum coverage is often the cheapest insurance in Alabama state, but isn’t always the best coverage, given that you may need extra coverage in certain situations such as if you finance or lease your vehicle.

Your place of residence and work significantly impact your car insurance premium. Car insurance rates in Alabama vary by city and even neighborhood, with drivers in high-traffic and theft-prone areas often paying more.

For instance, car insurance rates may be higher in Mobile than in Huntsville owing to the city's higher motor vehicle theft rates.   

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Average Cost of Car Insurance in Alabama Cities

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*Please note that these are approximate rates! For an accurate quote, get in touch with our professional insurance advisors.

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What are Alabama’s Auto Insurance Policy Requirements?

Each state has its specific auto insurance laws and requirements that dictate how car accidents are handled. The minimum car insurance requirements in Alabama are:

• All registered vehicles must be covered with an auto insurance policy
• Alabama motorists are required to carry liability coverage at a minimum
• Collision and comprehensive insurance are optional but most drivers opt for physical damage insurance
• Penalties for driving without insurance or the minimum coverage include a $500 fine and/or a six-month driver’s license suspension (first offense), and a $1,000 fine and/or a six-month license suspension (second offense)
• Alabama SR-22 insurance is only required if you’ve been convicted of a DUI/DWI, have committed serious driving violations, or have failed to maintain insurance coverage in the past

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Is Alabama a No-Fault State?

Determining who is at fault in a car accident is the first step toward being compensated for damages and injuries.

However, not all states including Arkansas and Washington allow accident victims to pursue compensation based on liability and fault—aka no-fault states.

Alabama is an at-fault state, meaning that the motorist who caused the accident pays for the injuries and property damage of the other, also called a tort liability insurance system.

In a no-fault state, you are required to have no-fault insurance, sometimes referred to as personal injury protection (PIP)

Fault states do not offer PIP insurance but motorists have the option of buying MedPay—a slightly watered-down version of personal injury protection coverage.

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Do I Need Car Insurance in Alabama?

You need the basic liability insurance coverage policy before getting in the driver’s seat, but the type of extra insurance coverage depends on your needs.

You don’t need car insurance in Alabama for a vehicle that’s not being driven and is in storage.

However, scrimping out on car storage insurance, dubbed as parked-car insurance can prove costly because unfortunate events do occur, even if your vehicle never leaves the driveway.

We understand car insurance can be pricey, and often confusing, which is why we recommend getting in touch for the best auto insurance quote in Alabama.

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The Best Car Insurance Companies in Alabama

We work with some of the esteemed car insurance companies in the country to give you a rate that sometimes feels “too good to be true”.

Auto insurance rates are known to fluctuate frequently, but you can rely on UR Choice Insurance to offer you the best auto insurance rates in Alabama.

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What Does Car Insurance in Alabama Not Cover?

Before we buy anything, we tend to check what’s included, but when it comes to car insurance, knowing what’s excluded maybe even more important.

The good news is that most of the exclusions of Alabama auto insurance coverage can be addressed with additional coverage with car insurance endorsements.

Most standard car insurance policies in Alabama exclude:

1. Custom parts, modifications and upgrades

If you’ve fitted your vehicle with custom parts or performed any modifications or upgrades to make it look pretty and boost its performance, a standard car insurance policy will typically cover up to $1000 and other companies can go as high as $20,000.

2. Losses above your policy limits

Alabama car insurance only pays for up to the limits listed in your policy. So, for example, if your liability insurance component only covers $25,000 worth of property damage, and you cause an accident that causes damage of around 30,000, you’ll be on the hook for the remaining $5,000.

3. Mechanical breakdowns

A standard auto insurance policy in Huntsville, Mobile, and other cities in Alabama doesn’t usually cover mechanical problems unless caused by a mechanical peril.

For example, if you’re driving down the road and hit a pothole, and it causes a ripped tire, then your collision coverage would fix that.

While collision coverage protects you against vehicle damage caused by an accident, it doesn’t cover mechanical issues, for which you need a specialized insurance policy called mechanical breakdown insurance.

4. Pet injuries

Just like humans, pets traveling in your vehicle are susceptible to injury in the event of a car accident. Unfortunately, whether vet bills are covered or not depends on your car insurance policy.

One of the best car insurance companies in Alabama—Progressive offers $1000 in protection for pets injured in covered accidents.

There are two ways to protect your paw-pals in a car accident, speak to us about finding car insurance that includes pet insurance or buy pet insurance in Alabama (pet insurance pillar post).

5. Rideshare, delivery, and other commercial use

If you’re going to be using your vehicle for business purposes, you’ll need commercial auto insurance in Alabama.

Some policies do offer add-ons (endorsements) such as ridesharing insurance if you drive for Uber or Lyft.

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How Much Car Insurance Do I Need?

Two common questions we receive at UrChoiceInsurance are — how much car insurance do I need and what is the best car insurance near me?

Apart from the minimum limits for auto insurance liability coverage in Alabama—" $25,000 bodily injury/person/accident. $50,000 combined bodily injury/accident”, the key to figuring out how much car insurance you need is examining your specific situation.

Beyond what is required by Alabama state laws, you should aim to buy a car insurance policy that pays for injuries, property damage, and lawsuits that may stem from a car accident even if you have savings to pay for them.

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How Do I File a Car Insurance Claim in Alabama?

The process of filing a car insurance claim in Alabama can be overwhelming, but the leading Alabama car insurance companies have specific tools to make it easier.

1. First things first—call your insurance agency immediately after an accident and explain the situation. Next, ask the agent what your policy covers and the last date to file the claim.

2. Gather the required information, which could include things like a police report, names of the people involved, and repair estimates.

3. File your claim via the appropriate channel—phone, email or app, and find out the process of getting a rental car if your insurance policy covers it.

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How to Save Money on Car Insurance in Alabama?

Buying the right car insurance policy in Huntsville, Orange Beach, Gadson or another other major city in Alabama can be a challenge. These 5 auto insurance tips can potentially help you save money on the best auto insurance in the Peanut State.

1. Boost your credit score

Traffic accidents and tickets can considerably increase the price of your car insurance premium, but surprisingly to many, so can your credit.

Research from leading auto insurance companies in the United States indicates that drivers with bad credit are more likely to file claims, making them more expensive to insure.

2. Combine more than one policy

You’re probably already aware of this secret to getting affordable car insurance in policy—if you don’t, simply bundle your auto insurance coverage with your home insurance or other types of insurance coverage.

For example, both State Farm and Allstate provide a bundle discount of 25 percent and 35 percent respectively.

3. Save money with safe driving

Being a mindful driver keeps you safe on the road and can reduce your Alabama auto insurance premiums. Several car insurance companies provide safe driver discounts including Nationwide and Progressive.

4. Opt for higher deductibles

We encourage our customers to choose higher deductibles when creating a bespoke auto insurance policy in Alabama if they can afford it.

Although a high deductible will increase your out-of-pocket costs for covered repairs, it does lower your overall insurance rate.

5. Remove unnecessary coverage

It’s easy to stack many types of auto insurance coverage at the time of creating a policy. For example, you may have signed up for comprehensive and collision coverage but makes no sense to have if the cost of these two coverages plus your deductible exceeds your vehicle’s value.

Call to Action: When you’re ready to buy the best, hopefully, cheapest car insurance in Alabama, reach out to our professional auto insurance advisors for a deal you just can’t refuse.

WHAT ELSE CAN I DO TO SAVE ON AUTO INSURANCE?

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There are multiple discounts that can help you save on your premiums:

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• Multi-policy discount: Bundle home and auto policies with us for up to 20% off.
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• Multi-car discount: Insure all your vehicles through the same carrier for savings up to 25%.
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• Good driver discount: Drivers with no violations can save up to 30%.
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• Good student discount: Full-time students under 25 who maintain a B average can save up to 15%.
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• Defensive driver discount: Taking an approved safe driving course can save 5-15%.
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• Short Mileage discount: Drive less than the average and save based on actual mileage.
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• Anti-theft device discount: Install a qualifying device like car alarm or tracking system for potential savings.
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• Save Driving Discount: Continue to drive safely and maintain a clean record. Check in often for new discounts you may qualify for over time. We are happy to review money-saving options at your next policy renewal.

*Disclaimer: Discounts available and the amount of discount applied to a policy may vary by carrier.

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The Right Auto Insurance for You

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Getting in an accident can lead to costly vehicle repairs, medical bills, lawsuits, and more. Having insufficient coverage is a risky and expensive gamble. Work with our trusted agents to ensure you have the optimal auto insurance policy in place before you hit the road. We make it fast and easy to get covered and save money. Reach out today to discuss your needs and get a free quote!