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Best homeowners insurance in Alabama for 2023

Updated Jan 03, 2023
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How Bankrate chose the best home insurance companies in Alabama

We looked at several aspects of each carrier in our search for the best Alabama homeowners insurance. First, we obtained average rates from Quadrant Information Services. Next, we analyzed each carrier’s coverage offerings, discounts and digital tools, to help you find a company that offers the financial protection you need and the functionality you may want. We also factored in third-party ratings from the 2022 J.D. Power U.S. Home Insurance Study for customer satisfaction, the National Association of Insurance Commissioners (NAIC) for complaint frequency and AM Best for financial strength.

We combined all of this research to create a proprietary Bankrate Score for each company. The Scores are on a scale of 0.0 to 5.0, with higher scores indicating a higher ranking in each category. Knowing the Bankrate Score for each company can help you quickly analyze the overall quality of that carrier’s home insurance product. This might make it easier to find the best home insurance company for you.

Best home insurance companies in Alabama

Based on our analysis of the Alabama homeowners insurance market, USAA, State Farm and Auto-Owners are among the top choices for coverage. Both USAA and State Farm offer average rates lower than the state average of $1,597 per year. If you’re shopping for the best home insurance in Alabama, you may want to start with quotes from these companies:

USAA
Rating: 3.7 stars out of 5
3.7
Bankrate Score
Info
J.D. Power
884
/1,000
AM Best
A++
Average monthly premium*
$63
Average annual premium*
$750
Get a quote
State Farm
Rating: 3.2 stars out of 5
3.2
Bankrate Score
Info
J.D. Power
829
/1,000
AM Best
A++
Average monthly premium*
$111
Average annual premium*
$1,329
Read review
Auto-Owners
Rating: 3.2 stars out of 5
3.2
Bankrate Score
Info
J.D. Power
825
/1,000
AM Best
A++
Average monthly premium*
$141
Average annual premium*
$1,697
Get a quote
Allstate
Rating: 3.5 stars out of 5
3.5
Bankrate Score
Info
J.D. Power
829
/1,000
AM Best
A+
Average monthly premium*
$132
Average annual premium*
$1,589
Get a quote
J.D. Power
Not rated
AM Best
A+
Average monthly premium*
$62
Average annual premium*
$746
Get a quote
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This advertisement is powered by Coverage.com, LLC, a licensed insurance producer (NPN: 19966249) and a corporate affiliate of Bankrate. The offers and links that appear on this advertisement are from companies that compensate Coverage.com in different ways. The compensation received and other factors, such as your location, may impact what offers and links appear, and how, where and in what order they appear. While we seek to provide a wide range of offers, we do not include every product or service that may be available. Our goal is to keep information accurate and timely, but some information may not be current. Your actual offer from an advertiser may be different from the offer on this advertisement. All offers are subject to additional terms and conditions.

Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.

*Premiums are for $250K in dwelling coverage

**Not officially ranked by J.D. Power due to eligibility restrictions

Best home insurance company for military-focused coverage

J.D. Power:
884 /1,000
AM Best:
A ++
Avg. annual premium for 250k dwelling
$ 750
USAA Insurance review

Explore Bankrate's review

Best home insurance company for local agencies

J.D. Power:
829 /1,000
AM Best:
A ++
Avg. annual premium for 250k dwelling
$ 1,329
State Farm Insurance review

Explore Bankrate's review

Best home insurance company for robust coverage

J.D. Power:
825 /1,000
AM Best:
A ++
Avg. annual premium for 250k dwelling
$ 1,697
Auto-Owners Insurance review

Explore Bankrate's review

Best home insurance company for discount opportunities

J.D. Power:
829 /1,000
AM Best:
A +
Avg. annual premium for 250k dwelling
$ 1,589
Allstate Insurance review

Explore Bankrate's review

Best home insurance company for low average rates

Cincinnati Insurance

J.D. Power:
Not rated
AM Best:
A +
Avg. annual premium for 250k dwelling
$ 746
Cincinnati Insurance review

Explore Bankrate's review

How much is homeowners insurance in Alabama?

The average cost of home insurance in Alabama is $1,597 per year for $250,000 in dwelling coverage. Compared to the national average of $1,383 for the same coverage, Alabama homeowners pay about 15% more each year. Average rates in Alabama may be higher than the national average due to the state’s position near the coast and relatively high likelihood of being hit with strong storms. Home insurance is less in Alabama than it is in neighboring states, though; Mississippi homeowners pay an average of $1,840 per year and Florida’s average home insurance rate is $1,648 per year.

Home insurance in Alabama

Alabama residents should know that the state can experience severe weather, including hurricanes and tornadoes. Understanding the common causes of damage in Alabama may help you better choose coverage options that fit your needs.

Common causes of loss in Alabama

Alabama only has a small section of coastline, but much of the southern part of the state is only separated from the coast by a hundred miles (or less) of Florida’s panhandle. This means that many of the causes of damage in Alabama are related to coastal weather.

  • Hurricanes: Due to its location on the Gulf Coast, Alabama is at risk for damage if a hurricane develops. Hurricanes can cause widespread and devastating damage.
  • Floods: Part of the damage associated with hurricanes is flooding. Floods are common in many parts of the state, with most counties experiencing at least 11 flood events per year, according to the Federal Emergency Management Agency (FEMA).
  • Tornadoes: Despite not being in “Tornado Alley,” Alabama had the second-highest incidence of confirmed tornadoes in 2021, according to the Insurance Information Institute (Triple-I). The state saw 100 tornadoes last year, and seven people lost their lives to the storms.

Home insurance coverage options in Alabama

If you are shopping for Alabama homeowners insurance, it’s important to understand the different types of coverage available and what kind of protection they offer. In addition to standard coverage types like dwelling, personal property and liability, you may want to consider some optional add-ons for more financial protection:

  • Roof replacement cost: This endorsement means you'll get the full replacement cost for your damaged roof rather than just the depreciated cash value. Not all roofs qualify, but if yours does, it could be a helpful option.
  • Service line coverage: Damage to service lines — like your water, gas and electric lines — is generally not covered in basic homeowners insurance policies. You may want to consider adding this type of coverage to your policy in case of damage by an excluded peril.
  • Flood insurance: Damage caused by flooding isn’t covered by standard home insurance policies. While a few companies offer an endorsement, you’ll generally need to buy a separate flood insurance policy from the National Flood Insurance Program (NFIP) or from a private carrier that sells flood insurance.

Frequently asked questions

Written by
Carol Pope
Insurance Writer

Carol Pope is an insurance writer for Bankrate and prior to joining the team, she spent 12 years as an auto insurance agent. During this time, she sold, serviced and underwrote auto insurance for people across the country. She also has experience selling supplement coverage such as umbrella insurance.

Edited by Insurance Editor
Reviewed by Director of corporate communications, Insurance Information Institute