STATE LAW – ALABAMA LIBRARY – GUIDE 02
Required Auto Insurance & Minimum Limits in Alabama
Alabama requires liability insurance and ties the minimum to 25 / 50 / 25
Subject to statutory exceptions, Ala. Code § 32-7A-4 requires Alabama-registered motor vehicles to be covered by liability insurance, qualifying commercial auto liability insurance, a bond or cash security. Section 32-7-6(c) sets the minimum at $25,000 for bodily injury/death to one person, $50,000 for two or more persons in one accident, and $25,000 for property damage. These figures are a statutory floor, not a measure of a serious injury claim's value. Effective October 1, 2025, § 32-7A-4(b)(2) provides that insurance or security for vehicles registered in another state must conform to the requirements of the laws of that state of registration.
Actual liability coverage may be higher or may involve additional policies
Obtain the declarations and complete policy for the accident date rather than treating the insurance card or statutory minimum as the whole coverage picture. Investigate the vehicle owner's policy, driver/household policies, employer or commercial coverage, and umbrella/excess policies when the facts support them. Keep the statutory minimum, actual purchased limit, amount offered, competing claims and other potential coverage layers in separate fields.
UM/UIM is a separate statutory coverage question
Section 32-7-23 generally requires UM bodily-injury coverage in qualifying Alabama automobile liability policies unless the named insured rejects it. The statute's definition of an uninsured motor vehicle includes specified underinsured situations where available bodily-injury liability limits are less than the injured person's legally recoverable damages. Obtain the UM endorsement and rejection/election history before treating the coverage as absent.
Build a coverage inventory before evaluating a limits settlement
List each driver, owner, passenger, employer/business relationship and household connection that may lead to insurance. Preserve cards, declarations, endorsements, UM rejection/election documents and written coverage positions. A statement that the tortfeasor carries minimum limits should trigger a documented search for additional liability and first-party protection, not end the inquiry.
Authorities and source notes
Ala. Code § 32-7A-4 — mandatory liability insurance/security; § 32-7-6(c) — 25/50/25 amounts; § 32-7-23 — qualifying UM/UIM inclusion, rejection and underinsured definition. Act 2025-345 (HB148), effective October 1, 2025, addresses vehicles registered in another state. Check the policy terms and law applicable on the accident date.
Closing guidance
Alabama's 25/50/25 minimum is only the starting point. Confirm the complete liability policy, UM/UIM status and every additional coverage layer before treating available insurance as known.
Official Alabama sources
Sources checked: October 13, 2026. Confirm the policy and law applicable on the accident date.
Code of Alabama · Alabama Department of Insurance · Alabama Judicial System