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Who Has the Cheapest Homeowners Insurance Quotes in Alabama?

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'The Heart of Dixie', Alabama is the 23rd most populous state in the US but has the 6th highest homeowners insurance rates thanks in part to its 53 miles of coastline. This coastal area has been walloped by large hurricanes in the past, including most recently Hurricane Ivan (2004), Hurricane Dennis (2005), and Hurricane Katrina (2005) which were all Category 3 storms. In an effort to find out which cities in the state had the cheapest (and most expensive) rates, the team here at ValuePenguin dug through the data to find out. Our analysis found that the average homeowners insurance rate in the state was $2,327 per year while the range was between $1,881 and $4,609. Read more below, or enter your zip code above to start finding quotes from a list of homeowners insurance companies.

Cheapest Homeowners Insurance in Alabama

We conducted a study that analyzed homeowners insurance rates of 75 cities of various sizes throughout Alabama from Progressive, Liberty Mutual, State Farm, Nationwide, and Farmers. We collected quotes for 2,000 square-foot homes and found that Progressive offered the cheapest homeowners insurance with an average annual rate of $1,634 for our sample homeowners policy. Below are the average annual rates for the five companies, ranked from cheapest to most expensive:

A ValuePenguin study showed Progressive had the best homeowners insurance rates for a sample policy and residence in Alabama.

RankCheapest Homeowners Insurance CompaniesAverage Annual Rates
1 Progressive $1,634
2 Nationwide 1,988
3 Farmers 1,988
4 State Farm 2,565
5 Liberty Mutual 3,916
Average 2,418

These rates were obtained for a sample property. We encourage homeowners to look for insurance quotes from multiple providers to ensure that they are getting the best rates for themselves.

Most Expensive Cities in Alabama for Homeowners Insurance

Four out of five of the most expensive cities for homeowners insurance reside in south Alabama with two of those being located directly on the water. The 5th (Opelika) sits in east-central Alabama, and while not imminently threatened by large storms that may blow in off the Gulf of Mexico, its costs are high due in part to property crime rates which are more than double the US average.

Rank City County Average Annual Rate % Increase vs. AL Avg
1 Fairhope Baldwin $4,609 98%
2 Mobile Mobile $4,307 85%
3 Andalusia Covington $2,957 27%
4 Brewton Escambia $2,910 25%
5 Opelika Lee $2,383 3%

Fairhope, AL

The most expensive city to insure your home in all of Alabama, Fairhope's location on the eastern side of Mobile Bay does it no favors when it comes to destructive storms that can make their way into the Gulf. This town of 15,000 is lauded for its natural beauty and stunning waterfront views, but those same advantages turn to disadvantages when the wind and rain picks up. Rates in Fairhope are around $4,609 per year which is 98% higher than the Alabama state average.

Mobile, AL

The 3rd most populous city in AL with almost 200,000 residents, Mobile sits just 20 miles northwest of our most expensive city, Fairhope. Amongst other distinctions, Mobile has been rated as the wettest city in the lower 48 with over 66 inches of rainfall per year. With its position on the water and the incredible amount of rain each year it's no big surprise that Mobile's rates are the 2nd highest in Alabama. Residents can expect to shell out $4,300+ per year or nearly $360 per month on average!

Andalusia, AL

While not situated directly on the water, Andalusia is still located in the southern portion of the state a short 70 miles from the Gulf of Mexico. In Andalusia's history there have been 19 natural disasters declared (13 major disasters and 6 emergencies) which is 50% more than the US average. Part and parcel with natural disasters are higher home insurance rates and Andalusia's $2,957 average, while much lower than Mobile, is still more expensive than what most Alabamian's pay.

Brewton, AL

Forty five miles southwest of Andalusia you'll find the smallest town on our list, Brewton, AL. Brewton is home to roughly 5,000 residents who can all claim they live in one of the 100 best small towns in America having been recognized twice by Norman Crampton in his 100 Best Small Towns in America book. Homeowners insurance premiums in Brewton average around $2,910 annually or 23% higher than the state mean.

Opelika, AL

The fifth priciest city on our "Most Expensive" list, Opelika is part of the Auburn-Opelika metro area and has nearly 30,000 residents living inside city limits. Opelika also has a lot going for it these days. In addition to being named the 10th 'Best Small City for Jobs' by Forbes it was also ranked 22nd in CNN Money's 'Best Places to Live' report. Much of this is a direct result of huge influx of investment capital ($632 million) that the town has received since 2005. Home insurance rates in Opelika aren't cheap however and that's due mostly to a crime rate that's twice the national average. Homeowners can see costs around $2,383 per year on average to insure their property.

Best Homeowners Insurance Rates in Alabama: by City

The cheapest cities in Alabama all sit inland and far away from the Gulf of Mexico. Because these towns won't be bearing the brunt of any large oceanic storms their rates are typically cheaper. Additionally, the top 3 cities have property crime rates that are significantly lower than the national average, which helps generally to drive rates down further.

Rank City County Average Annual Rate % Decrease vs. AL Avg
1 Vestavia Hills Jefferson & Shelby $1,881 -19%
2 Pelham Shelby $1,925 -17%
3 Auburn Lee $1,933 -17%
4 Montgomery Montgomery $1,962 -16%
5 Huntsville Madison $1,963 -16%

Vestavia Hills, AL

Only 5 miles from downtown Birmingham, Vestavia Hills is an upscale suburb of Alabama's most populous city. With nearly 35,000 residents, the town is one of Alabama's most rapidly growing and wealthy cities boasting a top-tier school system, loads of outdoor space, and plenty of retail shopping options. Add in the fact that crime rates in Vestavia Hills are much lower than the US average and you've got a city with the lowest homeowners insurance rates in the entire state. At $1,881 per year, premiums in town are 19% lower than the Alabama average.

Pelham, AL

Another suburb of Birmingham (albeit a bit further south) Pelham was recently rated as one of the 'Best Places to Raise Kids in Alabama' by Bloomberg Businessweek. It's easy to see why, as the community has plenty of activities for the whole family to get involved in from the Civic Complex & Ice Arena to the Ballantrae Golf Club. The mean home price in Pelham is $203,000 with the average annual homeowners insurance rate being $1,925...or 1% of the home's purchase price.

Auburn, AL

A college town home to the Auburn University Tigers, the city of Auburn is home to almost 60,000 residents. The area boasts an affordable cost of living, a growing economy, and plenty to keep busy with. Besides watching the Tigers play football on Saturdays during the fall season, Auburn residents also have access to miles of hiking trails and one of the top golf complexes in the US (RJT at Grand National). Unlike its neighbor Opelika, Auburn's crime rates are lower than the national average helping it secure the 3rd best home insurance rates in Alabama: $1,933 per year on average.

Montgomery, AL

A city brimming with history, Montgomery is the capital and 2nd largest city in the state of Alabama. Historically, it has many places of significance such as the Montgomery Bus Boycott (Rosa Parks) and the Alabama War Memorial. The city also attracted the first electric street car system in 1886 in addition to the first Wright Brothers flight school in 1910. Homeowners insurance premiums in Montgomery are the 4th most affordable in Alabama at $1,962 per year or $164 per month on average.

Huntsville, AL

Located in north-central Alabama only 20 miles from the Tennessee border, Huntsville has received significant recognition in the last 5 years as an up-and-coming city to live, work, and play in. Kiplinger even went as far as naming it the "Best City in the Country" back in 2009 citing its high income growth, robust household income, and plethora of jobs available in industries like missle-defense and aerospace (which explains Huntsville's nickname: The Rocket City). Now the city can add one more selling point to its resume: it has the 5th cheapest homeowners insurance rates in the state of Alabama at $1,963 per year!

Cost of Homeowners Insurance in Alabama: by City

Below is a list of 30 of the cities in Alabama that we included in our analysis. We looked at Alabama cities throughout the state both small and large to show you which had the best rates. Each number shown below is the average annual cost of homeowners insurance for that specific town.

In Alabama, ValuePenguin found the average homeowners insurance premium was $2,327 for a sample policy and residence.

Our Methodology

This study looked at 75 cities of different sizes spread throughout the state of Alabama. Rates were obtained from five different insurance companies (Progressive, Liberty Mutual, State Farm, Famers, and Nationwide). The sample homes we looked at were valued at $200,000 and were roughly 2,000 square feet in size. They were also constructed with a masonry veneer and asphalt shingle roofing. All policies had a $1,000 deductible. If you're interested in more shopping tips for homeowners insurance in Alabama you can always check out the Alabama Department of Insurance website for additional information. For more data on significant weather events that were referenced in our analysis you can go to the NOAA.

Lastly, here are 30 of the cities that we included in our study from A to Z.

City Average Annual Rate
Alabaster $2,152
Albertville 2,383
Alexander City 2,049
Andalusia 2,957
Anniston 2,243
Athens 2,021
Auburn 1,933
Birmingham 2,182
Brewton 2,910
Cullman 2,200
Decatur 2,020
Demopolis 2,234
Dothan 2,133
Fairhope 4,609
Florence 2,088
Gadsden 2,304
Greenville 2,229
Hoover 1,988
Huntsville 1,963
Madison 2,040
Mobile 4,307
Montgomery 1,962
Opelika 2,383
Pelham 1,925
Prattville 1,990
Selma 2,299
Troy 2,187
Trussville 2,015
Tuscaloosa 2,222
Vestavia Hills 1,881

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