Best cheap car insurance in Birmingham

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Birmingham is the most populated city in Alabama, with over 209,000 residents. While the Magic City is known for its rich history and fierce college football allegiances, you may have to look a little harder to find the best, cheap car insurance provider in Birmingham. The average annual rates for auto insurance in this city range from $556 per year for minimum coverage to $1,764 per year for full coverage — well-above the average rates for Alabama.

However, finding the right carrier that fits both your needs and your budget is a multi-pronged process. To make it a little easier, Bankrate has put together our recommendations for the best car insurance companies in Birmingham based on coverage options, competitive rates and customer service reputation.

Best car insurance companies in Birmingham

The best car insurance companies in Birmingham are Geico, USAA, Travelers and Allstate. These four providers stand out for a combination of high 2020 J.D. Power customer satisfaction scores in the Southeast region, and a number of coverage options, discounts and affordable premiums.

Insurance Company J.D. Power Score
(Southeast Region)
Average Annual Premium for Minimum Coverage Average Annual Premium for Full Coverage
Geico 857 / 1,000 $378 $1,490
USAA 909 / 1,000 $407 $1,292
Travelers 823 / 1,000 $424 $1,161
Allstate 846 / 1,000 $470 $1,405

Geico

Geico is no stranger to advertising for discounted rates and these rates are also found in Birmingham. Not only are Geico’s rates competitive, but the company earns some of the highest customer satisfaction rankings in the Southeast, ranking fourth overall in the 2020 J.D. Auto Insurance Study. Geico also offers a range of discounts, including for military families and club affiliations.

USAA

If you meet the eligibility requirements as a service member, military family member or veteran, then USAA provides a long list of discounts and coverage options. Though it is technically rank ineligible due to membership limitations, USAA does receive customer satisfaction scores from J.D. Power. In addition to the standard coverages you might expect, USAA offers options tailored to military members, including reduced auto insurance rates if you are deployed or your car is in storage.

Travelers

Travelers not only offers standard auto coverage at competitive rates, but also offers specialty options to further customize your policy. This includes new car replacement, accident forgiveness, rideshare coverage, gap insurance and roadside assistance. You will also find a long list of available discounts, ranging from policy bundling to driver training.

Allstate

Allstate offers numerous options to customize your policy and a wide variety of discounts to make your premiums work within your budget. The popular Drivewise app may allow you to save even more by providing safe driving tips and feedback. Other discounts include good student, paid in full and policy bundling to help you save even further.

Cheapest car insurance in Birmingham

The average cost of car insurance in the United States is $565 per year for minimum coverage, and $1,674 for full coverage. Alabama’s averages are slightly lower than the national average at annual rates of $469 for minimum coverage and $1,623 for full coverage. Fortunately, Birmingham offers several less expensive options, including Geico, which averages at $378 per year for minimum coverage.

Bankrate reviewed several carriers in the Birmingham area for financial stability, coverage options and customer ratings. With the analysis, Geico, USAA, Travelers, Allstate and Country Financial were found to offer competitive rates, high overall customer ratings and financial strength. For instance, USAA offers some of the least expensive rates, while maintaining an A- BBB rating and a high number of satisfaction points in the 2020 J.D. Power Auto Claims Study. This is in addition to USAA’s Superior A++ financial strength rating through AM Best.

Insurance Company Average Annual Premium for Minimum Coverage Average Annual Premium for Full Coverage
Geico $378 $1,490
USAA $407 $1,292
Travelers $424 $1,161
Allstate $470 $1,405
Country Financial $474 $1,820

Birmingham insurance requirements

Alabama requires drivers to maintain auto insurance with 25/50/25 minimum requirements, which includes:

  • $25,000 per person for bodily injury
  • $50,000 per accident for bodily injury
  • $25,000 per accident for property damage

However, purchasing the minimum coverage is not your only option, nor does it fit every personal circumstance. For instance, if you lease or finance a car, your lender or lessor typically requires you to add collision and comprehensive coverage. A leased car may also require the purchase of gap insurance and higher liability limits, depending on the lessor.

You should note that Alabama is ranked sixth in the country for the highest number of uninsured motorists on the roads, according to the Insurance Information Institute. Many insurers recommend adding uninsured motorist coverage to offset damage and bodily injury expenses in case of an accident where another at-fault driver is uninsured. To help determine the best coverage for our needs, consider consulting with a licensed insurance agent.

Car insurance discounts in Birmingham

Fortunately, there are several ways to save on auto insurance in Birmingham. While looking for car insurance quotes, also look for discounts you may qualify for. Below are some that are widely available in Birmingham and could reduce your annual premiums:

  • Policy bundling discount: You could take advantage of this discount if you have both a renters/condo/homeowners policy and an auto insurance policy with the same carrier.
  • Automatic payments discount: If you sign up to have your premiums automatically withdrawn from your bank account, several carriers offer an additional discount for this.
  • Paid-in-full discount: If you are able to pay your premiums up front, ask how much of a discount you are eligible for by doing so.
  • Defensive driving discount: Ask your carrier for a list of approved defensive driving courses as many carriers offer discounts for policyholder completion. Not only will you learn valuable information, but you could also earn a discount on premiums.

Frequently asked questions

What is the best car insurance company?

Determining the best car insurance company is based on your personal preferences and what matters most to you. Look for a carrier with strong financial ratings, high customer marks, along with competitive rates. Bankrate has reviewed several companies and found providers shared on this list — such as Geico and Allstate — along with others to be top choices based on these factors.

How much car insurance do I need in Birmingham?

It is tempting to purchase the minimum required by Alabama in order to save on premiums, but doing so could leave you vulnerable to major financial headaches. Most personal finance experts recommend at least $300,000 in liability instead of the bare minimum. This provides better limits for medical costs for others in case you are in a multi-car, multi-injury accident.

Is Alabama a no-fault state?

No, Alabama is considered an at-fault state. This means if you are the at-fault driver in an auto accident, your insurance limits are used to pay the injured party’s medical and property damage expenses, and the other driver can sue you to recover additional expenses related to the accident. Wanting to avoid these risks is yet another reason why many insurers advise you purchase as much liability insurance as you can afford.

Methodology

Bankrate utilizes Quadrant Information Services to analyze rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

  • $100,000 bodily injury liability per person
  • $300,000 bodily injury liability per accident
  • $50,000 property damage liability per accident
  • $100,000 uninsured motorist bodily injury per person
  • $300,000 uninsured motorist bodily injury per accident
  • $500 collision deductible
  • $500 comprehensive deductible

Rates are determined based on 2020 Quadrant Information Services data.

To determine minimum coverage limits, Bankrate used minimum coverages that meet each state’s requirements. Our sample drivers own a 2018 Honda Accord, commute five days a week and drive 12,000 miles annually.

These are sample rates and should be used for comparative purposes only. Your quotes may be different.