Alabama’s auto insurance requirements require that all drivers have current insurance. Proof of insurance must also be kept on the driver’s seat in case they need it.
Accidents are something that no one expects to happen, but it is what they are. Preparing for an accident is the best way you can protect yourself, your family, and your assets. You can face legal and financial penalties if you don’t have insurance.
Alabama has a “fault system” in place regarding financial responsibility for injuries, vehicle damage, and other losses resulting from car accidents. This means that anyone found to be at fault will have to pay for any injuries or damages.
Every Alabama driver should have minimum car insurance to avoid financial ruin, out-of-pocket expenses, and unnecessary stress. You should also increase these limits as much as possible and add on additional coverages as necessary.
Alabama has laws regarding car insurance
Alabama is not an exception. Nearly all states require that motorists have a minimum amount of coverage. There are many options available for car insurance in Alabama. However, it is important to understand the requirements. The Alabama minimum car insurance liability limits is commonly stated as 25/50/25. This is shorthand for:
- Limit $25,000 per person for bodily injury liability
- Maximum $50,000 for bodily injury to be paid in one accident
- Maximum $25,000 per accident for property damage
Alabama offers liability insurance
Alabama’s only requirement for car insurance is liability insurance. As noted above, this coverage is often divided into property damage and bodily injury coverages. Bodily injury coverage covers injuries and lost wages caused by another driver or their passengers. Property damage covers damage to another driver’s vehicle.
Your liability coverage does not cover your injuries or those of your passengers, nor damages to your vehicle. Additional coverage would be required.
It is not recommended to carry only liability coverage. This puts your assets and yourself at risk. Alabama’s liability limits may be higher than other states but this can still leave you without adequate coverage and could result in your assets being exposed. You could also be at financial risk due to Alabama’s minimum car insurance requirements.
With multiple passengers, medical expenses can quickly add up. Property damage is not covered by $25,000, even if multiple vehicles are involved.
To avoid paying huge bills or being sued by another party, it is highly recommended that drivers increase their insurance limits. The Insurance Information Institute (III) reports that 78% of drivers insure with comprehensive coverage. 74 percent also purchase collision coverage.
Is Alabama a no-fault state?
Alabama is not considered a state of no-fault. This means the driver responsible for an accident pays the other driver’s medical bills. All evidence is used by police and insurance companies to determine fault. Insurance pays the at-fault driver to cover damages.
Drivers can also share “fault”. For example, one driver may be 25% responsible for an accident, while the other driver is 75%.
Alabama is one the five states with contributory negligence laws. This means that you cannot sue if you are even 1% responsible for an accident. The other party can only sue if the driver is 100% at fault.
Alabama penalizes drivers who drive without insurance
Drivers who decide to drive without insurance can be charged with a violation of Alabama insurance laws. The fine for the first offense is $500. There is also a 45-day suspension of registration and $200 reinstatement fee. The fine for the second offense (or any subsequent offense) is $1,000. There will be a 4-month suspension of registration with a $400 reinstatement charge and up to six months suspension of your license.
Depending on the severity, additional penalties could be imposed such as jail time or a requirement that you carry an SR-22. This document is filed with the state and proves that you have the minimum coverage required by law. This document is also called a “Certificate Of Financial Responsibility.”
Alabama offers additional auto insurance options
Alabama may not require liability coverage. However, you have many options for coverage that will expand your protection and coverage.
- Comprehensive coverage: This coverage covers your vehicle against non-collision events such as theft, hitting an animal, hail damage, and other mishaps.
- Collision coverage: This coverage covers your vehicle in the event of a collision with another vehicle, or object.
- Loan/Lease payment: Also called gap coverage, this coverage is essential for anyone financing a vehicle. This coverage will cover the difference between the vehicle’s cash value and what you owe on the loan.
- Medical payments – MedPay covers medical expenses incurred by you or others in an accident.
- Rental car coverage: This covers the costs of renting a car until your vehicle is fixed. This coverage is not available if your car can be driven.
- Roadside Assistance: This covers flat tire costs, battery jumps, towing and towing expenses. The coverage provided by insurance companies can differ so be sure to check.
- Uninsured motorcyclist bodily injury: It is highly recommended that you have this coverage. This covers your bodily injuries if you are hurt by a driver without insurance or who can’t pay.
Questions frequently asked
Which Alabama car insurance company is best?
It is a great way to find an affordable policy which meets your needs. These are the top-rated car insurance companies in Alabama , according to our extensive research.
What is the best car insurance for Alabama?
Alabama doesn’t have the best or cheapest car insurance. It’s unlikely that Alabama is the most expensive or least expensive state for car insurance. The average cost for car insurance is $435 for minimal coverage and $1672 for complete coverage. Our research shows that are the most affordable car insurance companies in Alabama.
What is the definition of total loss for a vehicle?
Alabama codes define total loss as damage to vehicles equal or greater to 75% of their value.
What are the factors that affect your Alabama auto insurance rate?
Car insurance companies consider factors like your vehicle model, driving record, and previous insurance claims, regardless of where you live. Alabama also considers the following: credit score, age, education, occupation, gender, marital status, and zip code.
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