How Much Does Renters Insurance Cost in Alabama?
Alabama renters pay some of the highest renters insurance rates in the country, at an average $222 a year. This is largely due to weather extremes and crime rates in the state. Many renters insurance companies in Alabama can provide coverage for you.
Looking for renters insurance in Alabama? We can help you:
How much does renters insurance cost in Alabama?
If you're looking for renters insurance in Alabama, you can expect to pay an average premium of $222 a year, or $19 a month. This ties Alabama with Texas for the fourth-highest renters insurance rates in the country. Alabama renters pay 24% more than the national average renters insurance rate of $179 a year.
How do I pick the best renters insurance company in Alabama?
The following table shows the major renters insurance companies operating in Alabama, along with their J.D Power renters insurance customer satisfaction rating and NAIC Complaint Index.
| Company | J.D. Power rating (out of 1,000) | NAIC Complaint Index (lower is better) |
|---|---|---|
| Nationwide | 831 | 0.2% |
| State Farm | 836 | 3.4% |
| Allstate | 841 | 0.8% |
| USAA | 888 | 0.8% |
| Travelers | 807 | 0.03% |
| Farmers | 839 | 0.1% |
| Liberty Mutual | 825 | 0.2% |
| Progressive | 835 | 0.2% |
| Sources: J.D. Power 2020 U.S. Home Insurance Study, 2020 NAIC Complaint Index | ||
When looking for your best renters insurance policy, follow these steps:
Shop around for renters insurance quotes
Alabama is one of the more expensive states to buy renters insurance in, so comparing quotes from multiple providers is in your best interest. There is usually very little difference in coverage offerings from renters insurance companies, so price is a major decision point. Look at the renters insurance quotes that providers are offering in your area, pick four or five with the best prices and start comparing.
Research providers' customer satisfaction ratings
Companies such as J.D. Power put out annual reports that rank the customer satisfaction levels of rental insurance providers. The stronger a provider's customer satisfaction, the greater their ability to retain and renew policyholders.
Customer satisfaction reviews aren't the only resources to check out. Talking to family, friends and neighbors about where they get renters insurance is also a great way to see which companies know how to keep their policyholders.
Look at each insurance company's Complaint Index
Throughout the course of the year, the National Association of Insurance Commissioners compiles data regarding complaints due to claim delays, denials and unsatisfactory payouts leveled at renters insurance companies. The average Complaint Index is 1.0. The lower a provider's Complaint Index, the fewer complaints they receive from consumers.
Factors that affect renters insurance rates in Alabama
With an average premium of $19 a month, Alabama renters pay 24% higher premiums than the national average of $15 a month. The key reasons for these higher rates include regional factors such as:
Hurricanes
In 2020, Alabama experienced a record-breaking 30 named storms. Hurricanes can do a lot of damage in Alabama, and renters insurance providers calculate that risk into their rates.
Burglary
According to Safewise, burglary accounts for 20% of all property crime in Alabama. This is higher than the national average of 16%. While burglary is covered by renters insurance, the greater risk can result in higher renters insurance rates in the state.
Do I need renters insurance in Alabama?
While no Alabama state law requires you to carry it, landlords frequently require tenants to have renters insurance.
For instance, if someone is injured in your rental home and you're found responsible, you'll be expected to cover the medical and legal fees. Furthermore, if your belongings are damaged, your landlord's insurance won't cover their replacement either. Landlord insurance only covers the structure of the rental unit. When you sign the rental agreement, it should include the minimum renters insurance limits required of you.
Even if your landlord doesn't require you to have renters insurance, it's a good idea to get it anyway. For just a few dollars a month, you can protect your belongings, avoid potentially paying thousands of dollars in court costs and medical fees after an injury, as well as get other great coverage.
What does renters insurance cover?
A renters insurance policy covers three key categories:
Personal property
If your belongings are stolen or destroyed by a covered peril, the personal property section of your renters policy will help pay to replace your possessions. In order to make sure you have the correct amount of personal property coverage, make an inventory list that includes serial numbers, makes, models and replacement costs of your belongings.
Personal liability
If someone is injured in your rental home, or you damage their property, personal liability helps cover property replacement, as well as legal fees and medical bills that could arise.
A standard personal liability limit in renters insurance policies is $100,000, but you'd be surprised at how quickly a long hospital stay or legal case can go through that amount. Any legal fees, medical bills or replacement costs beyond the policy limit will come out of your pocket. For that reason, you should raise your liability coverage to at least $300,000.
Loss of use
If a hurricane or flood hits your rental home and it's rendered unlivable, you'll need a place to stay — and possibly extra funds to maintain your standard of living while your place is repaired.
Loss of use (LOU) coverage, also known as "additional living expenses", helps to pay for a hotel room, meals, extra commuting costs and even laundry. The LOU limit of a renters insurance policy usually goes up to 40% of your personal property coverage limit.
Which exclusions should Alabama renters know about?
The key exclusion from renters insurance that is important to Alabama policyholders is flood damage. While wind damage from a hurricane is usually covered by renters insurance, flood damage isn't. In order to get the proper hurricane coverage in Alabama, you should get flood insurance.
Many of the top renters insurance providers in Alabama take part in FEMA's National Flood Insurance Program (NFIP), which provides flood insurance in the U.S. If your current renters insurance company doesn't sell flood insurance, shop around and find an insurer that does.
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