Alabama residents have car insurance costs well below the US national average. Car insurance in Alabama typically costs about $856 per year, according to the Insurance Information Institute, while the typical American pays around $935 in car insurance premiums per year.
Car insurance companies consider your location, age, gender, and driving record to calculate rates for premiums. Other factors like credit score, marital status, vehicle type, previous coverage, and miles driven can all play a role in the amount you'll pay for coverage
To get the best deal on car insurance, you'll have to shop around and get quotes from several different companies. Then, you'll want to compare the coverages to get the best insurance policy for your money.
The most popular car insurance companies in Alabama based on market share
The following are the most popular car insurance companies in Alabama, based on the percentage of insured Alabama drivers who use them:
| Company | Market share (%) |
| State Farm | 22.95 |
| Alfa Mutual Group | 13.58 |
| GEICO | 11.23 |
| Allstate | 10.86 |
| Progressive | 9.35 |
| USAA* | 7.47 |
| National General Holdings | 3.12 |
| Travelers | 2.25 |
| Liberty Mutual | 2.11 |
| Farmers Insurance | 2.11 |
| Nationwide | 2.06 |
| Auto-Owners Insurance | 1.65 |
| COUNTRY Financial | 1.63 |
| Safeway Insurance | 1.57 |
| MetLife | 1.08 |
| First Acceptance | 0.92 |
| Auto Club Exchange | 0.79 |
| The Cincinnati Insurance | 0.74 |
| American Family Insurance | 0.72 |
| Home State Insurance | 0.71 |
*USAA is only for active military, veterans, and their families.
Data from S&P Global Market Intelligence
The best car insurance in Alabama based on customer satisfaction
Customer satisfaction with car insurance providers may factor into your decision. According to J.D. Power, a consumer research company that surveys customers, these are the top car insurance companies in the Southeast region (which includes Alabama):
The best cheap car insurance in Alabama based on credit score
Consumer Reports compiled data from car insurance companies across the US, and found what each company would charge for a single adult driver in each state at varying credit levels. Here are the companies it found were the cheapest in Alabama for each credit level.
| Credit level | USAA | GEICO | Allstate |
| Excellent: FICO 800+ | $554 | $581 | $1,064 |
| Good: FICO 670-739 | $687 | $732 | $1,328 |
| Poor: FICO 300-579 | $1,015 | $1,978 | $2,136 |
The best car insurance for drivers with a clean record
For a driver in Alabama age 25 or older with no accidents and one vehicle, the following companies provide the best average rates:
| Company | Average monthly insurance premium |
| State Farm | $126 |
| Bristol West | $133 |
| Progressive | $138 |
| GEICO | $148 |
| Liberty Mutual | $149 |
| Allstate | $153 |
| Esurance | $159 |
| USAA* | $186 |
| Travelers | $189 |
*USAA is only for active military, veterans, and their families.
Above data obtained from Savvy, based on 1,366 policyholders in the state of Alabama
Best car insurance for one or more accidents on record
For a driver in Alabama age 25 or older, with one or more accidents and one vehicle, the following companies provide the best average rates:
| Company | Average monthly insurance premium |
| Progressive | $159 |
| GEICO | $160 |
| Farmers | $171 |
| Esurance | $179 |
| Allstate | $180 |
| State Farm | $205 |
Above data obtained from Savvy, based on 1,366 policyholders in the state of Alabama
Alabama car insurance rates by city
Below is the estimated average annual premium of auto insurance policies per household in Alabama's most populous cities:
| City | Average annual insurance premium |
| Birmingham | $1,232 |
| Montgomery | $1,305 |
| Huntsville | $1,370 |
| Mobile | $1,284 |
| Tuscaloosa | $1,276 |
| Hoover | $1,519 |
| Dothan | $1,304 |
| Auburn | $1,313 |
| Decatur | $1,264 |
| Madison | $1,583 |
| Florence | $1,236 |
| Phenix | $1,293 |
| Gadsden | $1,229 |
| Prattville | $1,407 |
| Vestavia Hills | $1,577 |
| Alabaster | $1,477 |
| Opelika | $1,315 |
| Enterprise | $1,363 |
| Bessemer | $1,268 |
| Daphne | $1,455 |
| Northport | $1,376 |
| Athens | $1,298 |
Data from S&P Global Market Intelligence
Who gets the best car insurance rates in Alabama?
In general, those who see the best premiums on car insurance are drivers with good credit histories and good driving records. However, other factors like the type of car you drive, where you live in Alabama, your gender, age, and even marital status could have an effect on what you pay.
But there's one other thing that you can do to get the best rate: Shop around. Even within the same credit level, the differences between one company and another can be huge, highlighting the importance of getting more than one quote. Every insurance company assess your risk and prices your policy differently, so you'll want to see what several different companies will offer you.
Once you have several quotes, you'll want to compare them. Don't just look at the premiums — look for the most coverage for your money, and consider the types and amounts of coverage each policy provides. Also consider the deductible, or the amount you'll have to pay for out of pocket if you get into an accident. Generally, the cheaper the plan, the higher the deductible.
Ronda Lee is an associate editor for insurance at Personal Finance Insider covering life, auto, homeowners, and renters insurance for consumers. She is also a licensed attorney who practiced litigation and insurance defense.