Alabama drivers have to purchase liability insurance for their vehicles. If you don’t want to carry liability insurance, you must show that you have financial responsibility for example cash deposit and liability bond. If you choose to purchase the motor vehicle liability bond, make sure you file with the Motor Vehicle Division in the Department of Revenue. The minimum requirement for cash deposit is at least $50,000. The minimum requirement for bodily injury liability insurance is $25,000. For multiple persons, the minimum required coverage is $50,000. The minimum required insurance coverage is $25,000 for property damage. Previously, the minimum requirement for the auto insurance coverage is lesser. The new auto insurance law was put into effect starting on the 30th of August 2008.
If your car is rented, you must buy the rental car insurance. Normally, rented cars are covered with insurance from the credit card company. If the car is already insured by the car rental agency, you don’t need to buy the rental car insurance. In Alabama, it is not a requirement to purchase the uninsured/underinsured motorist coverage. If anyone sit in your household sit in the vehicle, you must include their names in the auto insurance policy.
Under the rules of Alabama, every driver in the household have to be protected by the liability insurance coverage. It is necessary to buy more than the required amount of insurance. In this way, you don’t have to worry about having no money to pay for the accident damage cost. The accident cost such as car repair and medical fee can costs you thousands of dollars. Without proper liability insurance coverage, you will have to pay the full amount out of your own pocket. Some auto insurance companies offer discount for customers that buy more than minimum required amount. It is important that you carry the insurance proof at all time. You have to bring the proof of liability insurance if you are in the vehicle. If you fail to show the insurance proof to the law enforcement offer, he can fine you $500. Besides, you may be penalized with imprisonment.
Personal credit history is used to determine the rate of the insurance premium. The insurer will refer your personal credit history to find out if you have the ability to settle the premium punctually. It will be used to determine whether you should make monthly payment or quarterly payment for the auto insurance. Your personal credit history will be used to create the insurance risk score. The better your personal credit score, the lower the premium fee you have to pay. Alabama follows the tort system so the person who is at fault will be responsible of paying the accident cost including medical expenses, car damage cost and etc. Because Alabama is a no fault state, it is necessary to get sufficient insurance coverage. In case accident happens, you can file a claim and let the insurance company pay for all the costs. You should always do research before signing up for an insurance policy.
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