Auto Insurance in Alabama (AL)

If You Are Paying More Than $1,044.35 on Auto Insurance in Alabama, You Are Paying Too Much.

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Auto Insurance Industry in Alabama

  • An average consumer pays $1,243.00 on auto insurance
  • 221 of every 100,000 vehicles are reported stolen every year
  • Accident fatality rate of 1.51%
  • Of all accidents: 67% are road-way accidents, 19% are intersection accidents, and 15% of all accidents involve at least 1 truck.

An Overview of Auto Insurance and Driver’s License Information in Alabama

Before you wait in long lines at Alabama’s DMV, take some time to gather accurate information. Whether you need a new driver’s license or have to transfer an out-of-state license, collecting the right information can serve as a guide to pertinent documents you will need. The information provided below offers useful details on what you need to know regarding auto insurance requirements and what you need to apply for a driver’s license in Alabama.

Alabama's Minimum Requirements on Auto Insurance

Registering and operating a vehicle in Alabama includes demonstrating financial responsibility. Driving on Alabama roads is a privilege that comes with the obligation to purchase adequate auto insurance. Generally, auto insurance is necessary to prove that you are covered financially if you are involved in a vehicle accident. Without auto insurance, you cannot legally operate a vehicle on Alabama’s roads.

There are several ways that you can demonstrate financial responsibility for driving. As an alternative to carrying auto liability insurance, you can make a minimum of $50,000 purchase for one of two types of bonds: a Motor Vehicle Liability or Certificate of Cash. Typically, most vehicle owners purchase liability insurance from insurance companies authorized to sell insurance in Alabama.

The minimum requirements for liability insurance coverage include:

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

All drivers are required to keep proof of insurance in their vehicle at all times. Proof may include the insurance card receipt of payment of the declaration page that you receive from the insurance company. Some drivers elect to keep a copy of their liability insurance policy in their vehicle.

A copy of the Motor Vehicle Liability Bond or Certificate of Cash Bond is also acceptable proof.

There are penalties for failing to maintain adequate liability insurance or some form of financial responsibility. In some cases, Alabama’s Motor Vehicle Division (MVD) can suspend your vehicle registration for not maintaining financial responsibility. The first offense requires a $100 reinstatement fee and documented proof that you have liability insurance. The reinstatement fee for the second offense will cost $200 after a four month suspension of your registration. Proof of insurance is also required.

Consumer Car Licensing Information in Alabama

Like other states, Alabama has specific requirements for residents who want to apply for a new driver’s license. Requirements may vary based on the type of license you need. New and current residents of Alabama may apply for a passenger, motorcycle and/or a commercial driver’s license.

If you are a new resident with a driver’s license from a different state, you must follow the out-of-state license transfer process. Basically, you need to present several documents at the MVD, which include your out-of-state driver’s license, social security card $5 transfer fee and a minimum $23.50 driver’s license fee. Checks are not accepted.

The same fee applies to receive a standard driver’s or learner license. In addition, you will also need two forms of identification with one containing a photograph. Three forms are required for acceptable non-photo identification documents.

Prospective drivers younger than 19 years old must also provide confirmation of school enrollment or proof of graduation. To complete all tests needed to obtain a license, you should have proof of auto insurance, a licensed driver and an operable vehicle. Prospective drivers who are younger than 18 will need to take a driver’s education course before they can complete the other tests.

The written test is required for new drivers and is available in many different languages. There is also a $5 fee for the written test. Your age determines the next step after passing this test. If you are over 18, you may be able to take the driving test on the same day as the written test. However, if you are under 18, you must maintain a driver’s permit for six months.

Motorcycle Licensing Information in Alabama

To be eligible to apply for a motorcycle license, Alabama residents must be at least 14 years old. The designation for motorcycle drivers is M Class with a “B” restriction for 14 and 15 year olds. This restriction is removed when drivers turn 16.

A written examination is required to apply for a motorcycle license. Potential drivers can prepare for the exam by studying the Alabama Motorcycle Manual, which covers laws and practical tips for driving a motorcycle on Alabama roads. The following documents are required to take the exam:

  • U.S. birth certificate
  • Social security card
  • Valid identification such as a driver’s license, school photo ID, military ID, VA card or a marriage license
  • Proof of high school graduation or school enrollment form
  • Fees for the written test and license, which are $5 and $23.50 respectively

Commercial Vehicle Licensing Information in Alabama

Several steps are required to obtain a commercial driver’s license (CDL) from the Department of Public Safety. Some steps are completed before going to the local MVD office; others are completed at the office.

Before applying, you will need to receive a medical examination. Your doctor must certify your health status by providing a medical examiner’s certification. The form is in compliance with the Department of Transportation.

It is a good idea to also study specific regulations and safety practices regarding commercial driving. A Commercial Driver License Manual is available to help you prepare.

Once you are ready to take the knowledge and skills test, you should take the DOT medical certificate, driver’s license, social security care and proof of insurance to the closest office that issues CDL licenses. In addition, you will need to pay the $20 fee for the skills portion and $25 fee for the knowledge portion of the test.

CDLs are issued in three different classes: Class A, Class B and Class C. An additional fee is required based on the type of class. For example, the additional fee is $23.50 if you need a CDL to operate a school bus. Endorsements and individual counties might charge additional fees.

More Resources on Auto Insurance in Alabama

Department of Insurance

  • P O Box 303351 Montgomery, AL 36130-3351
  • Phone: 334-269-3550
  • Fax: 334-241-4192