Alabama Car Insurance Laws and Requirements

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  • Alabama Car Insurance Laws and Requirements

Whether you’re headed to the beaches of Gulf Shores, the bustling city of Birmingham, or Tuscaloosa to cheer on the Crimson Tide, those traveling by car must ensure they have the legal minimum required auto insurance in the Heart of Dixie. All drivers must have active car insurance policies in Alabama that meet the minimum legal requirements, lest they face the consequences of driving uninsured.

Let’s look at what the legal minimum car insurance coverage is in the Heart of Dixie, why the laws mandate this coverage and other questions you may have about the state’s auto insurance laws. 

What Are the Alabama Insurance Laws for Car Insurance?

It’s required by law that all drivers have car insurance in Alabama. When it comes to liability car insurance, Alabama residents must have at least $25,000 in bodily injury liability per person, $50,000 in bodily injury liability per accident, and $25,000 in property damage liability per accident, otherwise noted as 25/50/25 liability coverage. Those who finance or lease their vehicles may be required to have collision and comprehensive coverages on their policies as a stipulation on their legally binding contract. 

If you have at least 25/50/25 liability coverage, you’re considered adequately insured in the Heart of Dixie. Failure to abide by Alabama car insurance requirements can lead to hefty fines, license and registration suspension, or even jail time. 

What Are the Alabama Car Accident Laws?

In Alabama, car insurance laws mandate all drivers must have a minimum of 25/50/25 in liability coverage. Liability coverage protects other drivers on the road from the policyholder by providing coverage for medical expenses or vehicle repairs the victim may incur due to an accident caused by the policyholder. 

Since Alabama isn’t a no-fault state but a tort state, drivers must carry liability coverage to protect each other. No-fault states typically mandate coverage that protects the policyholder directly, while tort states mandate liability coverage to help protect drivers from the policyholder’s mistakes. 

Say a policyholder with the minimum 25/50/25 liability coverage caused a collision with another driver. The policyholder’s insurance would cover the victim’s medical expenses and vehicle repairs up to the policy limit. However, if the victim’s expenses surpass the policyholder’s coverage limits, the policyholder is liable for the remaining expenses. 

Since Alabama is a tort state, meaning at least one driver must be considered at fault in every accident, drivers can sue each other after accidents. At-fault drivers with the legal minimum liability coverage open themselves up to a lawsuit if their coverage limits don’t cover the total of a victim’s expense. Plus, those with a liability-only policy will be liable for all their own expenses in an accident they cause. 

There are a variety of accident scenarios in which a driver with the legal minimum coverage won’t be covered. To protect oneself in a range of accident scenarios, it’s a better idea to have a full coverage policy with coverages that protect the policyholder directly, like medical payments coverage (MedPay), uninsured or underinsured motorist coverage, collision coverage, and comprehensive coverage.

Is Car Insurance Required in Alabama?

Yes, Alabama car insurance requirements mandate all drivers must have a minimum of 25/50/25 liability coverage lest they face the consequences of driving without insurance. Driving with the legal minimum amount of coverage helps protect other drivers on the road from any expenses they may ensure in an accident caused by the policyholder. It also allows policyholders to avoid legal penalties for lacking adequate coverage.

Those caught driving without insurance in the Heart of Dixie can face fines of up to $1,000, license and registration suspension, vehicle impoundment, and possibly even jail time. The fees associated with one offense of driving without insurance are often more expensive than the average premium for a full coverage policy in the state, which is about $1,670 annually.

That’s not to mention any legal fees an at-fault driver may face after causing an accident while driving uninsured, as victims of car accidents in Alabama are permitted to sue at-fault drivers for pain and suffering. 

Plus, having the stain of driving without insurance on one’s driving record can make it more difficult and expensive to find coverage in the future. High-risk drivers who’ve previously driven without coverage or had to file an SR-22 may pay double or triple the state average in car insurance premiums. 

It’s often much more cost effective to carry at least the minimum required coverage than risk the financial downfall associated with driving uninsured. While the short-term savings of forgoing coverage entirely may be enticing, the risk isn’t nearly worth the reward. 

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What Are the Alabama Liability Insurance Requirements

In Alabama, the minimum insurance requirements state all drivers must have at least 25/50/25 liability coverage. While maintaining the minimum liability coverage required in the state will protect you in the eyes of the law, a policy with such coverage may not provide enough protection to ensure your safety in any scenario.

Those with liability-only policies may risk financial ruin in an at-fault accident. If a policyholder with the minimum liability coverage is at-fault in an accident and the victim’s expenses exceed the 25/50/25 liability limit, the policyholder will be liable to pay the victim’s expenses out of pocket. 

Why Does Alabama Require Car Insurance?

Alabama has a state minimum auto insurance required by law to protect all drivers on the road. Requiring drivers to carry insurance allows the state to ensure most people on the road will be covered in the event of an accident. 

Requiring drivers to carry auto insurance coverage also helps mitigate the overwhelm of court systems in many states. Without required insurance, drivers may take legal action more often to have their accident expenses covered, which would cause court systems to become severely backed up. While drivers in tort states like Alabama still frequently take legal action in the event of an accident, insurance systems help relieve a lot of the pressure that would otherwise fall on the courts. 

Do You Need Car Insurance in Alabama?

Yes, all drivers need the minimum car insurance in Alabama, which is 25/5025 liability coverage. Those who fail to maintain this amount of coverage are liable for any legal consequences they may face from breaking the law, plus any expenses that accrue in the event of an accident. 

Not only is it legally required to have car insurance in the Heart of Dixie, but it’s generally a much better financial decision to carry a policy than to forgo one entirely. The annual premium associated with the cheapest policy in the state is far more affordable than the legal repercussions of driving without insurance.

Do You Have To Have Car Insurance in Alabama?

Yes, Alabama vehicle insurance requirements mandate all drivers must have a minimum of 25/50/25 liability coverage in the state. Failure to maintain an active and adequate policy may result in hefty fines, license or vehicle suspension, or even jail time, which can become very expensive. 

While it’s essential to maintain a policy you can afford, having enough coverage to protect you in any type of accident is equally as important. Even with a minimum coverage policy, there is a significant risk of financial ruin if you cause an accident for which the expenses far exceed your policy limit. 

To ensure you’re getting enough out of your policy, you may consider binding with one of the top insurers in the state. Many of the state’s best insurers, like Nationwide, Progressive, and Travelers, offer fantastic coverage for low base rates with plenty of opportunities for discounts, so policyholders don’t have to sacrifice coverage for cost. 

What Is the Minimum Auto Insurance Coverage in Alabama?

Property damage and bodily injury liability in Alabama are the minimum required coverages in the state, with a limit of at least 25/50/25 of liability coverage required on every policy. Drivers who maintain the minimum liability coverage are entirely protected under the eyes of the law but may not be covered in the worst-case accident scenario. 

Drivers who prefer protection for various accident scenarios may consider bumping up their coverage from liability-only to a full coverage policy. A full coverage policy allows policyholders to tailor their policy to their needs, with coverages and limits set to their comfort level. It’s generally a more financially-sound decision to carry a full coverage policy with a range of coverages to offer protection for various mishaps that may happen to you or your vehicle. 

What Is Considered Full Coverage Auto Insurance in Alabama

In Alabama, a full coverage policy is any policy that has coverage that exceeds the minimum limit of 25/50/25 liability coverage. This means any policy with a higher liability limit or additional optional coverages tacked on is considered a full coverage policy.

While having a policy you can afford is crucial, having a full coverage policy may protect your savings in the long run. A full coverage policy carries a more significant investment, as premiums are generally more expensive on a full coverage policy than a minimum coverage one. Still, an investment in one’s safety is never a wrong decision. 

How To Find an Auto Insurance Quote in Alabama

The best way to find a policy that meets the legal minimum coverage limits in the Heart of Dixie and checks all the boxes for what you need for your safety is to get and compare quotes online. By getting and comparing quotes, drivers can make an informed decision on what insurer and policy is best for their needs, as all car insurance policies are subjective to the drivers they cover.

Luckily for you, you’ve come to the right place for quotes. Here at Clovered, we have a free quoting tool you can use to get and compare quotes tailored to you in minutes. If you’d rather chat with a professional about your quotes, you can contact one of our licensed agents at 833-255-4117 or

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The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.

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