Alabama Insurance Exam Prep CH 4 (2025)

1



Alabama Insurance Exam Prep CH 4
(2025)
Which of the following is not eligible for the Dwelling Program?



A

Dwelling has 4 apartment units



B

Dwelling includes a piano school



C

Dwelling is located on farm property



D

Dwelling has 5 roomers - (answers)C



Which of the following dwelling forms pays for losses to the dwelling on an actual cash value
basis?



A

DP-2 Broad Form



B

DP-3 Special Form

, 2


C

DP-1 Basic Form



D

DP-4 Liability Form - (answers)C



Which of the following dwelling program forms covers the building on an open peril basis?



A

DP-1 Basic Form



B

DP-4 Liability Form



C

DP-2 Broad Form



D

DP-3 Special Form - (answers)D



Coverage A - Dwelling

Coverage B - Other Structures

Coverage C - Personal Property

Coverage D - Fair Rental Value

Coverage E - Additional Living Expenses - (answers)Tips

, 3




An attached carport is covered under which of the following coverages?



A

Coverage C - Personal Property



B

Coverage D - Fair Rental Value



C

Coverage A - Dwelling



D

Coverage B - Other Structures - (answers)C



The Coverage B limit of insurance is up to 10% of the Coverage A limit and is automatically
provided under each of the dwelling forms. In the case of a DP-1, this limit does not increase the
amount of insurance provided by Coverage A. The DP-2 and DP-3 forms provide additional
insurance.




Example



The Coverage A limit on an insured dwelling is $100,000. In a DP-1, a detached garage would
be covered for up to $10,000; however, the most the policy would pay for loss to both the
dwelling and garage is $100,000. Under the DP-2 and DP-3 forms, the garage would be covered