Alabama Car Insurance

Auto insurance is the law in the state of Alabama. Alabama drivers are required to carry minimum auto liability insurance of $20,00 for one person, $40,000 for all parties in an accident for bodily injuries and $10,000 of minimum coverage for property damage. This amount of coverage may be more simply stated on an auto insurance policy as 20/40/10.

UIM Coverage

Although it is not required by Alabama law, purchasing Uninsured/Underinsured Motorist ("UIM") coverage is very important. It applies in the event the at–fault driver in an accident is uninsured or does not have enough insurance to pay for the damages sustained by the other driver(s) or passengers in the accident. While a total of $40,000 for bodily injury damages may seem like a lot of money, it can be used up quickly in a serious injury accident or accident involving multiple parties.

For example, if a Alabama driver in an accident had 15/30 UIM coverage, he or she would be able make a UIM claim with their auto insurance company and when applicable, be able to receive up to an additional $15,000 for their own bodily injury damages. A UIM claim would be valid if the at fault driver was uninsured or the UIM insured sustained bodily injury damages beyond the limits of the at fault driver's liability limits. Per the UIM policy limits, the insurer would only pay up to 350,000 for all UIM bodily injury claims stemming from the accident.

If your insurance company makes a payment under a UIM claim, they may pursue reimbursement for their expenses from the at fault party. This is a significant benefit as attempting to obtain payment from a private party for damages can be difficult.

PIP Coverage

Personal Injury Protection ("PIP") is no fault coverage. It is also not required by law, but is an important type of insurance coverage. PIP pays for "reasonable and necessary" medical bills for the insured driver and their passengers in an accident. PIP is the primary form of medical coverage for an auto accident. If medical expenses exhaust the PIP limits, the insured can then bill remaining amounts to their health insurer.

Collision and Comprehensive Coverage

Other important available types of insurance coverage in Alabama are Collision and Comprehensive. These coverage types are also not required by law but can be very important in the event of an accident. Also, many financial institutions require vehicle owners to purchase collision and comprehensive coverage as a condition of their loans.

Collision pays for vehicle repairs or vehicle replacement value following a collision regardless of fault. Comprehensive coverage pays for all vehicle repair damage or replacement value for incidents other than a collision such as the tree falling on a car or the car being stolen. There are minimum deductible limits for these collision and comprehensive such as $500, but Alabama drivers can also raise their deductible amounts to lower their premiums.

Keep Your Auto Insurance Current

It is very important that Alabama drivers do not allow their auto insurance policies to lapse. Each day, hundreds of Alabama drivers are involved in auto accidents. Uninsured drivers in Alabama have to pay fines and may be forced to comply with state financial responsibility laws, which require them to purchase expensive SR–22 Insurance. Uninsured or underinsured drivers can also be held personally responsible for all damages caused in an accident. Driving without car insurance in Alabama is very imprudent and can lead to financial ruin.

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