Key Takeaways
- Alabama follows pure contributory negligence for all negligence claims, not just auto
- Commercial general liability policies use file and use rate regulation
- Alabama has specific requirements for pollution liability disclosure
- Professional liability insurance is recommended but not required for most professions
- Punitive damages may or may not be insurable depending on policy language
Last updated: January 2026
Alabama General Liability Insurance
Alabama has specific requirements for general liability insurance that agents must understand.
Contributory Negligence
Alabama uses pure contributory negligence for all negligence claims:
How It Works
- Fault is determined for all parties
- If plaintiff has any fault, NO recovery
- Very different from comparative negligence states
- Applies to slip and falls, product liability, auto accidents, etc.
Key Differences from Comparative Negligence
| System | Alabama Rule |
|---|---|
| Pure Contributory | Any fault = no recovery |
| Comparative | Recovery reduced by % fault |
| Modified Comparative | No recovery if over 50-51% at fault |
Exam Tip: Alabama's contributory negligence is crucial for liability claims. Any fault bars the plaintiff from recovery.
Commercial General Liability (CGL)
Alabama CGL policies must comply with state requirements:
Required Elements
- Occurrence vs. claims-made coverage clearly disclosed
- Coverage territory defined
- Limits per occurrence and aggregate
- Defense costs—duty to defend
- Pollution exclusion with disclosure
Rate Regulation
Under file and use:
- Rates filed with ALDOI
- Can be used immediately
- Subject to post-implementation review
- Must be actuarially justified
Professional Liability
Alabama regulates professional liability for various professions:
Coverage Recommendations
| Profession | Requirement |
|---|---|
| Attorneys | Required to disclose if no coverage |
| Medical Professionals | Strongly recommended |
| Architects/Engineers | E&O recommended for licensed practice |
| Real Estate Agents | Recommended but not required |
| Insurance Agents | Recommended but not required |
Products Liability
Alabama products liability insurance:
Coverage
- Bodily injury from defective products
- Property damage from defective products
- Products-completed operations hazard
- Aggregate limits apply
Alabama Law
- Strict liability for manufacturing defects
- Negligence standards for design defects
- Contributory negligence applies
- Statute of repose: Generally 10 years
Premises Liability
Alabama premises liability considerations:
Duty of Care
| Visitor Type | Duty |
|---|---|
| Invitee | Highest duty - inspect and warn |
| Licensee | Warn of known dangers |
| Trespasser | No duty except no intentional harm |
Contributory Negligence Impact
- If visitor has any fault, no recovery
- Even failure to observe obvious hazard can bar claim
- Critical for claims adjustment
Pollution Liability
Alabama has specific pollution liability requirements:
Disclosure Requirements
- Pollution exclusion must be disclosed
- Environmental impairment liability options explained
- Underground storage tank requirements
- Cleanup cost coverage options
Alabama Environmental Laws
- EPA and state environmental regulations apply
- Alabama Department of Environmental Management (ADEM) oversight
- Strict liability for certain hazardous activities
Test Your Knowledge
What duty does an Alabama property owner owe to an invitee?
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Test Your Knowledge
What rate system does Alabama use for commercial general liability insurance?
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B
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D