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Home Insurance and Car Insurance in Alabama
With cities rich in history, beautiful architecture, breathtaking natural landmarks and a humid subtropical climate that proves inviting during most of the year, it’s no wonder that over 5 million people call Alabama home.
Whether you live in Birmingham or Mobile or have roots in Montgomery or Tuscaloosa, it’s important to protect your investment in your home, automobile and other personal property. That’s why home and auto insurance are absolutely vital in Alabama. At SelectQuote, we can help you shop for home and auto insurance by comparing rates from dozens of trusted insurance companies. We can even show you ways to maximize savings by bundling your home and auto coverage, helping you save time and money in the process.
Homeowners Insurance in
Home insurance is necessary to protect both your house and personal property in the event of a loss. These losses can range from the minor—such as a broken window—to catastrophic.
Homeowners insurance isn’t required by law in most states. However, most banks and mortgage lenders require homeowners to have a home insurance policy. Alabama is no exception.
vIn addition to damage to your property, some Alabama homeowners insurance policies offer financial protection from liability in the event that someone gets hurt while on your property.
Homeowners insurance premiums vary based on a variety of factors, including both where you live and the total amount of coverage you have. A key detail to determine when purchasing home insurance is whether you have a cash value policy or a replacement cost policy. Regardless of policy type, most insurance companies require homeowners to insure homes for 80% of the replacement cost.1
- Actual cash value policies provide a payout of the current cash value of the lost or damaged property at the time of the claim. For example, a policy with a limit of $250,000 will only pay that amount. If the cost to repair or rebuild your home is $300,000, you’d be responsible for the remaining balance.
- Replacement cost policies are more expensive, but can be worth it. They pay the actual costs of the rebuild or replacement and do not take depreciation into consideration. If you plan on keeping your home for a while, it’s worth exploring this option. Replacement cost policies aren’t affected by inflation, zoning updates or increased costs for labor or materials.
Homeowners Insurance Coverage Options in
Most homeowners insurance policies come with standard coverage options built-in. Types of home insurance coverage available in Alabama include:
- Dwelling coverage, which covers the actual physical structure of your home. Attached garages or other structures are often covered as well. The average home value for an Alabama home sits at $186,367.
- Personal property coverage, which exists to cover the stuff inside and outside your home, including furniture, appliances and lawn equipment or tools.
- Personal liability coverage offers protection for when someone is injured on your property and you are found at fault. This kind of coverage also safeguards against damage to another person’s property.
- Guest medical protection coverage can cover people who end up injured on your property no matter who is found to be at fault.
Common Causes of Loss in
The Insurance Information Institute ranks Alabama 16th nationally for states where single-family homes are at risk of being damaged or destroyed by Category 5 hurricanes.2 Owing to its position on the Gulf of Mexico, hurricanes and tropical storms are a significant risk to homes. Other common causes of loss include:
- Flooding: Alabama’s location on the Gulf Coast makes parts of the state particularly vulnerable to flooding. Floods lead to damage in basements and ground-level floors, but can be detrimental to other property, too. Flash floods are sudden and can occur without warning.
- Tornadoes: Tornadoes can rip up housing structures and throw them miles away. According to analysis, Alabama has seen a marked increase in tornadoes. From 2000-2019, the annual average number of tornadoes reported doubled from 17.2 between 1980-1999 to 34.4 for 2000-2019.3
- Severe thunderstorms: Much like tornadoes, severe thunderstorms are a common cause of damage to Alabama homes. In addition to wind damage, hail can be a common culprit for property damage.
Additional Coverage Options Recommended for Homeowners
In addition to standard home insurance coverage, you should look into purchasing additional coverage that may not be part of your regular policy, such as:
- Flood insurance is typically not included as a regular component of a home insurance policy. But given the prevalence of flooding in Alabama, it could be a smart policy addition. If you have a mortgage and live in a flood zone, your lender may require this type of insurance anyway.
- Service line coverage exists to cover damage to water pipes, cable lines and other service lines that extend into your home. Many homeowners policies do not cover sewer lines outside of your home, making repairs costly.
- Sinkhole coverage is a rare type of insurance that protects you financially in the event of sinkhole damage. While they are typically rare, Alabama does rank highly for the number of sinkhole incidents—just behind Florida and Texas.4
Our Home Insurance Partners in
SelectQuote exclusively partners with the most trusted and highly-rated home and auto insurance companies in every state. We can shop for home insurance and compare rates to help you find the best value for your unique needs, whether you live along the Gulf Coast or the Appalachian foothills in northern Alabama.
What is the average home insurance cost in ?
The average home insurance cost in Alabama for SelectQuote customers is $125.22 per month.** Home insurance rates in Alabama can differ based on several factors, like your ZIP code, the age and condition of your home, your credit rating and the number of claims you’ve filed with other insurance companies.
Homeowners Insurance Discounts in
Insurance companies offer several home insurance discounts to their Alabama customers. You may receive a discount for paying your premiums on time or because you’ve never filed a claim. Some insurance companies may even offer discounts based on the length of time you’ve been a customer. One of the biggest ways to save money, however, is by bundling your home insurance policy with other insurance options.
Bundle Your Home and Auto Insurance to Save Money
When you bundle home and auto insurance, you can often enjoy significant discounts. SelectQuote customers save over $700* on average when they bundle their home and auto policies with one insurance carrier.
Average Home and Auto Insurance Rates in
The rate table below shows average monthly home and auto insurance rates paid by actual SelectQuote customers in Alabama in several cities. Your insurance rates may vary based on where you live, the condition of your home and other factors.
| City | Avg. Monthly Home Insurance Rate | Avg. Monthly Auto Insurance Rate | Avg. Monthly Rate of Bundled Policies |
|---|---|---|---|
| Birmingham | $137.05 | $270.62 | $164.53 |
| Decatur | $138.24 | $171.71 | $177.39 |
| Huntsville | $104.47 | $147.48 | $106.82 |
| Montgomery | $121.28 | $202.25 | $147.19 |
| Tuscaloosa | $116.02 | $401.21 | $175.94 |
Average monthly rates are from policies by SelectQuote customers prior to 01/2022
Auto Insurance in
Much like home insurance, auto insurance is key for Alabama residents. SelectQuote customers pay an average of $264.71 per month for auto insurance.*** Insurance companies paid $2.2 million in claims in 2019. As claims increase, so often do premiums. That’s why it’s important to shop smart for your policy to save time and money.
Auto Insurance Laws and Requirements
Alabama state law requires that each driver carry—at minimum—liability insurance coverage. The limits for this insurance coverage are commonly known as 25/50/25.5 This means:
- $25,000 for bodily injury liability coverage per person.
- $50,000 maximum for all bodily injuries for one accident.
- $25,000 maximum for property damage per accident.
While you are generally not required by the state to carry more coverage than this, you may need additional types of auto insurance coverage. Many auto lenders require comprehensive coverage—for accidents involving objects and animals—and collision coverage for vehicle accidents in order to be considered for financing on a new vehicle.
Other insurance exists to cover damage by underinsured or uninsured motorists. Personal injury protection insurance can pay for medical or funeral expenses for you or your passengers. Additional insurance, called gap coverage, may also be required. Gap coverage covers the difference between what you owe on a brand new vehicle and what it is currently worth.
All data on average expenditures is provided by the Insurance Information Institute.
| Type of Coverage | Amount Required |
|---|---|
| Bodily Injury Liability | $25,000 per person/$50,000 per accident |
| Property Damage Liability | $25,000 |
| Uninsured Motorist | Not required |
| Underinsured Motorist | Not required |
| Personal Injury Protection | Not required |
| Collision | Not required |
| Comprehensive | Not required |
| Gap Insurance | Not required |
Teen Driving Laws
Alabama’s driving laws for teens are based on a graduated system. The graduated driver’s license requirements are primarily based on age but also include passing grades for both written and road skills examinations.6
- Stage I licenses, also known as learner’s permits,are available to drivers who are 15 years of age and require parents, grandparents, legal guardians or licensed drivers who are age 21 or older to occupy the front passenger seat.
- Stage II driver’s licenses are restricted to drivers who are 16 years of age or older and have permission to drive without supervision from a parent, grandparent or legal guardian. They must not drive overnight unless accompanied by a licensed driver who is 21 or older. They must also not have other passengers in the car that aren’t parents, legal guardians or family members.
- Stage III licenses are available to drivers who are 17 and who have carried a Stage II license for at least six months prior to applying for a Stage III license.
Car Registration Information
In order to register a vehicle in Alabama, you’re required to show all proper documentation—including a certificate of title in most cases—as well as proof of mandatory liability insurance. The state will verify your insurance prior to registering your car.7
What is the average car insurance cost in ?
Car insurance rates in Alabama vary based on your ZIP code, make and model of the vehicle, your driving history and your credit rating. The average car insurance cost in Alabama for SelectQuote customers is $264.71 per month.***
Our Auto Insurance Partners in
SelectQuote’s auto insurance partners in Alabama are highly-rated and among the most trusted auto insurance companies. When you shop with SelectQuote, we’ll compare rates and coverage from our trusted insurance partners to find the right coverage at the right price for you.
Home and Auto Insurance Frequently Asked Questions
If you have questions about shopping for home and auto insurance in Alabama, we can help. Some of the most commonly asked questions we see from customers in your state can be found below.
How do I shop for insurance in Alabama?
How should I shop for homeowners insurance in Alabama?
- Figure out the right amount of coverage for your home and personal property. Keep in mind the cheapest insurance may not always be the best.
- Compare quotes from several companies at one time.
- Seek out available discounts such as bundled coverage, home security systems, etc.
How should I shop for auto insurance in Alabama?
- Determine your required coverage (minimum legal, dealer/lender required).
- Compare rates from several companies at once.
- Ask for available discounts, including those for safe driving behaviors and carrying a low deductible.
Do I need mobile home insurance in Alabama?
In 2019, an estimated 4,546 manufactured houses were shipped in Alabama.8 Mobile homes—one type of manufactured home—are not usually covered by traditional insurance. Mobile home insurance is a specific type of coverage that works to cover these homes and can be priced higher than traditional insurance coverage.
A reason for this is that mobile homes and other manufactured houses are more susceptible to damage from wind, hail and fire than stick-built houses or homes with foundations.
Is Alabama a no-fault state for auto insurance?
Alabama is not a “no-fault” state for auto insurance. This means the insurance claim is usually paid out by the at-fault party’s insurance company, and that fault is generally required to be proven prior to a payment of a claim.
What is recommended for car insurance coverage in Alabama?
In most cases, it’s recommended to carry full coverage on your automobile. In fact, many auto lenders require it if you finance the purchase of a vehicle with a loan. At a certain point, however, it may make sense to drop full coverage. If your car is worth less than your monthly premiums for full coverage, you may consider dropping it in favor of the minimum legally required coverage.
SelectQuote Can Shop Home or Auto Insurance to Help Save you Time and Money
When you need to shop for auto and home insurance in Alabama, SelectQuote can help you find affordable coverage that meets your needs. We compare rates from some of the most trusted insurance companies at once to find you home and auto coverage. We can even help you bundle your home and auto insurance for maximum savings.
Sources
- https://www.aldoi.gov
- https://www.iii.org
- https://www.montgomeryadvertiser.com
- https://www.usgs.gov
- https://www.aldoi.gov
- https://www.alea.gov
- https://contact.revenue.alabama.gov
- https://www2.census.gov
* Average customer who bundles savings based on an average of new SelectQuote Auto & Home Insurance policyholders between 1/9/2020 and 1/10/2021. Individual savings may vary, and are not guaranteed. Coverages and discounts subject to state availability and individual eligibility.
** Average rates calculated based on the total number of SelectQuote home insurance customers in . Rates will vary based on location, age and condition of home and other factors.
*** Average rate is taken from all drivers who have purchased their auto insurance policy from SelectQuote. Rates will vary based on the level of coverage you purchase, your ZIP code, and other factors.
