The best, cheapest car insurance in Alabama

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Best car insurance company in Alabama

Drivers in Alabama pay an average of $1,860 a year or $155 a month for car insurance coverage which makes it the 28^th most expensive state in the country.

Even though car insurance is pretty expensive in Alabama, it’s possible to find affordable coverage with top insurers such as Nationwide, Travelers, GEICO, and other insurers.

Nationwide is our choice for the best car insurance in Alabama. It finished first in our rankings with 4.61 out of 5 stars and an average premium of $1,345 a year, or $112 a month, which is $515 less than the state average.

State Farm was second with a score of 4.34 stars followed by Travelers with 4.32 stars.

The best car insurance companies in Alabama

How we picked the top auto insurance companies

When choosing the top car insurance companies in the state, we not only looked at the average cost of coverage but also J.D. Power customer satisfaction scores, AM Best financial strength ratings and National Association of Insurance Commissioners (NAIC) complaint rankings. National averages were used where state and regional data was not available.

For each of the four metrics, we gave companies in each state from 1 to 5 (5 being the best) based on how they performed in each category. Those components were then given the following weights, to arrive at an overall star rating.

• Premiums: 25%
• JD Power: 30%
• AM Best: 25%
• NAIC: 20%

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Cheapest car insurance in Alabama

Nationwide has the cheapest average rate in the state at $1,345 a year.

While Nationwide is the cheapest for many drivers, the perfect insurer for you may be a different company.

Insurers consider a wide variety of factors when setting a premium including your driving record, credit score, age, marital status as well the vehicle. Where you live also affects rates.

“States that have a higher rate of severe weather that damages cars or helps cause accidents will typically have higher rates,” says Chong Gao, director of product management R&D at Mercury Insurance. “Florida, for example, is prone to extreme weather like hurricanes and its car insurance costs are consequently much higher.”

Insurance companies crunch all this data with proprietary algorithms, which can result in dramatic differences in premium quotes.

The data clearly shows the range of premiums for similar drivers.

In Alabama, as mentioned earlier, the cheapest policy is Nationwide with an average rate of $1,345 a year. Travelers follows with an average premium of $1,428 a year or $119 a month and GEICO with premiums of $1,625 a year or $135 a month.

Farmers is the most expensive insurer with an average premium of $2,542.

Make sure you’re taking advantage of all the discounts you qualify for to ensure you’re getting the best possible rate. Ask your agent to review your policy for any available savings you might be missing.

Below are the cheapest car insurance rates by state. To calculate these rates, we used data for a 40-year-old driver of a 2023 Honda Accord LX – one of the most commonly insured vehicles – to provide a consistent and realistic comparison across states.

Cheapest full-coverage insurance in Alabama

Auto insurance premiums vary significantly from city to city, so drivers need to be sure they’re getting the best deal. Insure.com has done the research for you. Get more information on auto insurance rates by city below.

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Full coverage car insurance in Alabama

As noted, the rates above are for full coverage car insurance. Full coverage car insurance simply means you are carrying liability and any other state requirements as well as collision and comprehensive.

Full coverage insurance includes collision and comprehensive, which protects your own vehicle. Collision insurance will pay to repair your vehicle when it is damaged after colliding with another vehicle or object. Comprehensive covers damage that is done by perils such as fire, theft, flooding, vandalism, and more.

Shopping for car insurance in Alabama

Shopping around for coverage is a great way to make sure you are getting the best rates on your auto insurance. Experts often tell consumers to shop for insurance yearly. But that doesn’t necessarily mean you should be looking to switch.

“I recommend that people stay with the same insurance company, as they tend to get a better rate when they have been with the same carrier for more than 12 months. The more tenure you have with a carrier, the more potential there is to earn benefits,” says Tim Bottini, a Country Financial insurance agent based in St. Louis. “The carrier can also review your claims history and provide information about applicable discounts.”

But make sure you are comparing like coverage levels and deductibles.

“It is extremely important to make sure you start off with an apples-to-apples comparison,” Bottini says. “However, if a person has low limits, say 25/50/25 – limit per person/per occurrence/limit for property damage – I am going to recommend and quote at least 50/100/100. Depending on their age, income and profession, I would quote higher limits to protect their net worth and earnings potential.”

Bottini also says people can save money on their car insurance by keeping their credit score up, following the speed limit and placing both home and auto insurance with the same carrier.

Cheapest car insurance in Alabama by age

Car insurance rates will vary by age as reams of statistics show that teen and young adult drivers, because they are inexperienced on the road, take bigger risks and are more likely to get in anaccident and file a claim, which is why they pay more for coverage than older more experienced drivers.

Nationwide turned out to be the best insurer in Alabama for drivers of all ages. The numbers show the difference between young and old drivers with the lowest premium for a teen coming in at 91% more than the lowest premium for a senior driver.

Once a driver hits 25, rates will start to drop, assuming they keep their driving record clean, and will stay stable until their 70s when they will start climbing a bit.

Cheapest car insurance for senior drivers in Alabama

Seniors pay more for car insurance than other drivers, excluding teens. Nationwide is the best choice for seniors in Alabama, according to our data, with an average premium of $1,240 annually, which translates to $103 a month.

Travelers was the second most affordable at $1,435 and GEICO was next with a premium of $1,545.

“Seniors tend to have slower reaction times and may suffer from vision or hearing impairments, which can impair their driving ability. This makes them more prone to accidents and thus considered high-risk by insurance companies,” says Tariro Goronga, CEO of DriveSafe driving schools in Colorado.

The table below shows the average premium for senior drivers.

Average rates for seniors in Alabama

Car insurance for young drivers in Alabama

While young adults pay less than teen drivers, they still pay more than older more experienced drivers. The best choice for young adults (early 20s) in Alabama is Travelers with an annual rate of $2,212 or $184 a month.

Nationwide had the second cheapest premium at $2,263 a year followed by GEICO was third at $2,292.

If young drivers keep their driving record clean, their rates will drop down as they move out of their 20s.

The table below shows the best insurers for young drivers in Alabama:

Average rates for young drivers in Alabama

Car insurance for teen drivers in Alabama

Adding a teen to a car insurance policy will always push up the rate. Teens are the least experienced drivers out on the road which leads to more accidents and claims and higher premiums.

“Teen drivers are statistically more likely to be involved in accidents due to their lack of driving experience and tendency to engage in risky behaviors like speeding,” says Eliezer Zupnick, founder of East Leads Group LLC. “Teens are involved in three times as many auto accidents per mile compared to drivers aged 20 and up, making them a high-risk category for insurers.”

For Alabama teens, Country Financial is the most affordable option with a premium of $3,260 a year or $272 a month. GEICO is the next most affordable at $4,247 a year or $354 a month followed by Travelers running $4,371 a year.

If your teen has a B average or better, ask for a good student discount to help save a bit of money. Having your teen drive an older vehicle will also help save some money. If the car is old enough that you wouldn’t repair it after an accident, you may be able to drop collision and comprehensive.

The chart below shows average premiums for teens in Alabama:

Average rates for teens in Alabama

Average cost of car insurance in Alabama

In Alabama, the average premium is $1,860, which makes Alabama the 28^th most expensive state for coverage.

All states have large metropolitan areas, which will always push up the cost of insurance as more vehicles on the road lead to more accidents and claims. A high crime rate will also impact rates.

“If a state has a higher rate of car insurance claims associated with vandalism or car theft, prices are usually higher because car insurance companies view insuring these cars as a higher risk for them,” says Chong Gao, director of product management R&D at Mercury Insurance.

The chart below is the average rate in each state for a 40-year-old driver of a 2023 Honda Accord LX.

Average rates for a 40-year-old in Idaho

Which Alabama ZIP codes are most expensive for car insurance?

Where your vehicle spends its days and nights will impact your rate. Frequent severe weather or a high crime rate will raise the cost of insurance for everyone in the area.

Our data shows that Tarrant is the most expensive area for coverage with an average premium of $2,084 a year.

Here are the most expensive ZIP codes in Alabama for car insurance:

Most expensive ZIP codes in Alabama

Which Alabama ZIP codes are the cheapest for car insurance?

The cheapest ZIP codes for car insurance in Alabama tend to be in rural areas where there are fewer people and cars which leads to lower accident and claim rates. Fort Rucker has the most affordable ZIP code in Alabama with an annual premium of $1,664.

Least expensive ZIP codes in Alabama

Cheapest car insurance for high-risk drivers in Alabama

If you have an incident on your driving record, you may be considered a high-risk driver, and you will pay more for coverage. A speeding ticket, at-fault accident, or DUI can send your premium skyrocketing.

When we ran the numbers, we found that a speeding ticket in Alabama will push the average rate to $2,037 and an at-fault accident will push it to $2,457.

An accident will stay on your record for at least three years so you will be paying a higher premium for quite a while after an accident.

A DUI will usually result in a massive increase and could push your premium into unaffordable territory. If you are convicted of a DUI, your rate on average will climb to $2,884 a year. A DUI will be reported to insurers for three years, and if you are a commercial driver, it stays on your record for 55 years.

The table below shows the average increase for drivers with various incidents on their record:

How much rates increase in Alabama after a traffic incident

Minimum car insurance requirements in Alabama

Most states require drivers to carry a minimum amount of liability car insurance, and Alabama is no exception. Drivers are required to carry 25/50/25 in liability coverage, which translates into:

• $25k for injury/death per person
• $50k for injury/death per accident
• $25k for damage to property

But state-required minimums are rarely enough coverage in a serious accident. If you cause an accident and the damages exceed your coverage levels, you will need to cover the damages out of pocket.

The most common required coverages are $25,000 bodily injury liability per person, $50,000 bodily injury liability per accident and $25,000 property damage.

Experts typically recommend carrying 100/300/100 as a minimum liability coverage level.

What our expert says

Q: How does a state’s population affect car insurance rates?

Chong GaoDirector of product management R&D at Mercury Insurance.

“States with a higher population density have more cars on the road and thus more accidents and claims, increasing insurance rates. A more rural state like Iowa will have significantly lower average yearly car insurance costs compared to a highly metropolitan state like Alabama.”

Mark Vallet

Contributing Researcher

 

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Mark Vallet is a Denver-based insurance expert and journalist with 18 years of experience covering the car insurance industry. He specializes in breaking down complex insurance topics into clear, expert-backed insights that help drivers make smarter insurance coverage decisions.

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