Best Homeowners Insurance in Alabama (2024)
Allstate offers the cheapest homeowners insurance in Alabama, with rates that average $2,228 a year, or $186 a month.
We also recommend considering Farmers and USAA for their affordable rates, coverage options and customer service.
Cheapest home insurance companies in Alabama
Allstate is the cheapest homeowners insurance company in Alabama, with an average rate of $2,228 a year. This is 23% cheaper than the national average.
Farmers is the next-cheapest option at $2,445 a year, on average.
| Company | Average annual rate |
|---|---|
| Allstate | $2,228 |
| Farmers | $2,445 |
| Country Financial | $2,627 |
| The Cincinnati Insurance Cos. | $3,215 |
| Alfa Mutual Group | $3,231 |
| State Farm | $3,287 |
| Nationwide | $3,825 |
| Travelers | $5,639 |
| USAA* | $2,460 |
*USAA is only offered to military personnel and veterans along with their families
Best home insurance companies in Alabama
Allstate, Farmers and USAA are the best home insurance companies in Alabama based on their average rates, customer satisfaction ratings, coverages and complaint scores.
- Allstate is our overall pick for homeowners in Alabama
- Farmers is our pick for best coverages in Alabama
- USAA is the best option for military personnel and veterans
| Company | Average annual rate | Customer satisfaction rating |
|---|---|---|
| Allstate | $2,228 | 809 |
| Farmers | $2,445 | 800 |
| Country Financial | $2,627 | 819 |
| The Cincinnati Insurance Cos. | $3,215 | Not rated |
| Alfa Mutual Group | $3,231 | Not rated |
| State Farm | $3,287 | 829 |
| Nationwide | $3,825 | 812 |
| Travelers | $5,639 | 790 |
| USAA* | $2,460 | 881 |
Best overall home insurance in Alabama: Allstate
Allstate is the best home insurance company in Alabama due to its cheap rates and variety of discount offerings. However, its customer satisfaction score from J.D. Power is below average.
Pros
Low average rate of $2,228
Has a multi-policy discount of up to 25% off
Offers discounts that are easy to qualify for, like an automatic payment discount
Cons
Has a subpar customer satisfaction score of 809 (out of 1,000) from J.D. Power
Best home insurance company for coverages: Farmers
Farmers is a great home insurance option if you need extra coverage. Farmers also offers a variety of discounts that can save you money. However, it has a poor customer satisfaction rating from J.D. Power.
Pros
Low average rate of $2,445
Offers coverage that can help you if your identity is stolen
Also offers Building Ordinance or Law coverage for upgrades required by law
Provides discounts that not all insurers offer, such as good payer and new home discounts
Cons
Customer satisfaction score from J.D. Power is below average
Best home insurance company for military members: USAA
USAA offers affordable home insurance rates, superior customer service and great coverage. USAA also offers replacement cost coverage as a standard coverage. This covers your belongings based on how much it’ll take to replace them without factoring in depreciation.
However, USAA is only available to military members and veterans, as well as their families.
Pros
Has an excellent customer satisfaction score of 881 from J.D. Power
Offers replacement cost coverage for your items
Doesn’t have a deductible for personally owned military equipment and clothing
Cons
Isn’t available for everyone
How much is home insurance in Alabama?
The average annual cost of home insurance in Alabama is $3,217, which is 14% higher than the national average rate. Your home insurance rates depend on many factors, which can include:
- Your location
- The amount of coverage you need
- The deductible amount you choose
- Your claims history
- The age and condition of your home
Home insurance rates can vary greatly based on the amount of dwelling coverage you need. Your dwelling coverage amount should equal the cost of rebuilding your home. For example, raising your dwelling coverage from $350,000 to $400,000 can increase your rate by 12%, on average.
| Dwelling coverage | Average annual rate |
|---|---|
| $350,000 | $2,881 |
| $400,000 | $3,217 |
| $450,000 | $3,549 |
Insurance companies may be able to estimate your home’s replacement value based on the square footage, location, age of your home and more.
Alabama home insurance rates by city
Your location can also have a big impact on your home insurance rate. Among the most populated cities in Alabama, average home insurance rates range from $2,455 a year in Auburn to $5,101 a year in Mobile.
Mobile is close to both the Gulf of Mexico and Mobile Bay, which is why home insurance rates tend to be high there.
| City | Average annual rate |
|---|---|
| Huntsville | $2,746 |
| Birmingham | $2,906 |
| Montgomery | $2,615 |
| Mobile | $5,101 |
| Tuscaloosa | $2,662 |
| Hoover | $2,506 |
| Auburn | $2,455 |
| Dothan | $2,676 |
| Madison | $2,731 |
| Decatur | $2,867 |
Additional home insurance coverages needed in Alabama
Tornadoes, hurricanes and floods can occur in Alabama. A standard home insurance policy will cover some natural disasters, but you need a separate policy for flood coverage.
Flood insurance
Home insurance policies will not cover damages from floods. However, you can buy flood insurance through the National Flood Insurance Program (NFIP) or from private flood insurance companies. The NFIP offers up to $250,000 in building coverage for your home and up to $100,000 in contents coverage for your personal belongings.
If you live in a high-risk flood zone and have a mortgage, your lender will most likely require you to buy flood insurance.
Wind damage
Standard homeowners insurance policies usually cover wind damage, which can help protect you against tornadoes and hurricanes.
If you want to be better protected against hurricane damage, we recommend buying both a home insurance policy and flood insurance. Standard home insurance policies don’t cover flood damage from a hurricane.
Methodology
The rates shown in this article are based on non-binding quotes collected from Quadrant Information Services. Your rates may vary. Average rates were compiled from rates in Alabama. The following coverages and deductible were used unless otherwise noted:
- $400,000 dwelling coverage
- $40,000 other structures
- $200,000 personal property
- $80,000 loss of use coverage
- $100,000 liability
- $5,000 medical payments
- $1,000 deductible
Overall satisfaction ratings were obtained from J.D. Power’s 2023 U.S. Home Insurance Study. The agency’s scores are based on customer surveys that rate insurance companies on factors including price, policy offerings and claims.
Complaint ratings are based on NAIC Complaint Index data from 2023. A company with a 2.0 Complaint Index score has twice as many confirmed complaints as expected for its size. A company with a 0.5 rating has half as many.
*USAA only provides insurance to currently serving and retired military personnel, and their families.