Insurance in Alabama: A Guide to Auto & Home Coverage
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Shopping for insurance can be overwhelming, especially if you’ve recently moved to a new state or you’re buying a type of insurance you’ve never had before.
Whether you’re a newcomer or a long-time resident, you need to know all your insurance options in the beautiful state of Alabama. In this guide, we’re breaking down insurance offerings in Alabama, factors that affect rates and premiums, and how to compare policies to find the right insurance to meet your needs.
Types of Insurance Coverage Available in Alabama
Auto Insurance in Alabama
The Alabama auto insurance system functions on an at-fault basis. This means that in the event of an accident, the driver determined to be responsible for the collision assumes financial and legal responsibility.
If you’re a driver in Alabama, it’s highly recommended that you purchase uninsured motorist coverage as well as comprehensive coverage. Uninsured motorist coverage protects you if you’re hit by an uninsured driver. Comprehensive coverage protects you from non-collision damage such as theft, vandalism, or a fallen tree branch.
All vehicle owners in Alabama are legally required to purchase liability coverage, so insurance companies operating in the state must include this coverage in their plans. The car insurance Alabama requires must also meet minimum property and bodily injury liability coverage limits.
Home Insurance in Alabama
Home insurance isn’t legally required in Alabama. However, mortgage lenders almost always insist on it. If you have a mortgage on your home, you probably need home insurance. Having insurance can also protect you from the financial risk of damage caused by hazards like fire, theft, or natural disaster and protect you from potential lawsuits.
The following coverages usually come with a standard AL insurance policy (HO-3 policy):
- Dwelling coverage: This protects the physical structure of your home, including attached structures like porches or covered patios.
- Other structures coverage: This covers detached structures on your property, such as sheds, fences, or detached garages and shops.
- Personal property coverage: This covers your personal belongings, such as clothing, jewelry, furniture, and electronics.
- Loss of use coverage: This may cover the cost of increased living expenses if you’re unable to remain in your home while it undergoes repairs after sustaining a covered loss.
- Personal liability coverage: This covers you if you’re found legally responsible for another person’s injury or damage to their property.
- Medical payments to guests: This may cover the cost of medical expenses associated with a covered loss.
Alabama has some unique considerations when it comes to property damage liability. Flooding isn’t generally covered under a standard home insurance policy. If you live in a flood-prone area, consider buying a separate flood insurance policy. Windstorm insurance may also be a necessity for those who own coastal properties.
Health Insurance in Alabama
Health insurance providers offer coverage for individuals to reduce the financial burden of health care costs, both on a routine and emergency basis. Residents in Alabama can obtain health insurance coverage through the following:
- Employer-sponsored insurance
- Marketplace insurance
- Government-subsidized insurance (Medicare and Medicaid)
- Private insurance
Average Cost of Insurance in Alabama
The average monthly car insurance premium in Alabama is $153. This is slightly lower than the national monthly average of $189 [ https://www.everquote.com/alabama-car-insurance]. If you’re looking for cheap auto insurance in Alabama, start by comparing quotes from multiple insurance companies.
The average annual home insurance cost in Alabama is $1,386. This is higher than the national average of $1,192, primarily due to increased risk of severe weather damage.
Factors Affecting Insurance Rates in Alabama
There are a number of location-related factors that can impact your yearly insurance rates, including:
- Population density: Densely populated areas have higher risks of traffic accidents, theft, and vandalism.
- Risk of natural disasters: Some homes are at greater risk of hurricanes, tornados, or flooding.
- Cost of living: Some areas have higher car repair and medical costs.
Useful Alabama Insurance Resources
You can visit the Alabama Department of Insurance website to find agency information, file a complaint, or see a list of insurance companies in Alabama, but if you’re looking to compare side-by-side insurance quotes, EverQuote is your go-to resource.
Search for the best car, home, renters, and life insurance rates in Alabama and find the right insurance company to meet your needs.