ALABAMA PERSONAL LINES INSURANCE EXAM QUESTIONS AND
Alabama Personal Lines Insurance Exam Review
ANSWERS (VERIFIED AND WELL DETAILED ANSWERS) LATEST
Study online at https://quizlet.com/_hbo6dw
2025/2026
1. Expense Ratio An insurer compares what it paid in claims against the amount
received in premium.
2. Loss Ratio An insurer compares what it paid in claims against the amount
received in premium.
3. Uninsured Motorist Coverage In Alabama, the minimum limits are $20,000 per person and
$40,000 per accident for bodily injury.
4. Named Peril Policy The burden of proving that a loss is covered lies with the in-
sured.
5. Coverage E (Personal Liability) The standard policy limit under Section II of the Homeowner's
policy is $100,000 per occurrence.
6. Automobile Collision Would be considered an accident and an occurrence.
7. FORTIFIED Upgrade Before beginning, it is important to receive an evaluation and
Current Conditions Report.
8. Debris Removal Under a Homeowner's policy, it is covered if the loss is due to a
covered peril.
9. Excluded Property Losses Loss due to earth movement, neglect to preserve property fol-
lowing a loss, and flood are excluded.
10. FORTIFIED Home The Bronze level requires a continuous load path, providing
connections from roof to wall, wall to floor, and floor to foun-
dation.
11. Coverage A under a Dwelling Contains coverage for the dwelling and all permanent attach-
Policy ments.
12. Broad Cause of Loss Form Adds coverage for damages caused by all except Theft.
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, Alabama Personal Lines Insurance Exam Review
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13. Personal Auto Policy Following a physical damage loss, it pays the amount necessary
to repair or replace the auto or the auto's actual cash value.
14. Coverage F - Medical Pay- Under the standard Homeowner's policy, the basic limit is
ments to Others $1,000.
15. Homeowner's Form The form also known as the Condominium Owner's form is
HO-6.
16. Arbitration A means of transferring to the insurance company the insured's
right to collect from a negligent third party.
17. Flood Definition under NFIP Generally includes mudslides, runoff of surface water, and over-
flow of tidal waters.
18. Insurance Binder Validity In Alabama, it is valid for 30 days or until a policy is issued,
whichever is less.
19. Coverage D under Homeown- Contains coverage for loss of use.
er's Policy
20. Subrogation A means of transferring to the insurance company the insured's
right to collect from a negligent third party.
21. Casualty Insurance Includes liability insurance.
22. Personal Property Valuation Under the Dwelling forms, personal property is generally valued
at Actual Cash Value.
23. Insurable Risk Characteristics There must be uncertainty of loss.
24. Insurance Premiums Considered to be trust funds received by the producer in a
fiduciary capacity.
25.
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Alabama Personal Lines Insurance Exam Review
ANSWERS (VERIFIED AND WELL DETAILED ANSWERS) LATEST
Study online at https://quizlet.com/_hbo6dw
2025/2026
1. Expense Ratio An insurer compares what it paid in claims against the amount
received in premium.
2. Loss Ratio An insurer compares what it paid in claims against the amount
received in premium.
3. Uninsured Motorist Coverage In Alabama, the minimum limits are $20,000 per person and
$40,000 per accident for bodily injury.
4. Named Peril Policy The burden of proving that a loss is covered lies with the in-
sured.
5. Coverage E (Personal Liability) The standard policy limit under Section II of the Homeowner's
policy is $100,000 per occurrence.
6. Automobile Collision Would be considered an accident and an occurrence.
7. FORTIFIED Upgrade Before beginning, it is important to receive an evaluation and
Current Conditions Report.
8. Debris Removal Under a Homeowner's policy, it is covered if the loss is due to a
covered peril.
9. Excluded Property Losses Loss due to earth movement, neglect to preserve property fol-
lowing a loss, and flood are excluded.
10. FORTIFIED Home The Bronze level requires a continuous load path, providing
connections from roof to wall, wall to floor, and floor to foun-
dation.
11. Coverage A under a Dwelling Contains coverage for the dwelling and all permanent attach-
Policy ments.
12. Broad Cause of Loss Form Adds coverage for damages caused by all except Theft.
1/7
, Alabama Personal Lines Insurance Exam Review
Study online at https://quizlet.com/_hbo6dw
13. Personal Auto Policy Following a physical damage loss, it pays the amount necessary
to repair or replace the auto or the auto's actual cash value.
14. Coverage F - Medical Pay- Under the standard Homeowner's policy, the basic limit is
ments to Others $1,000.
15. Homeowner's Form The form also known as the Condominium Owner's form is
HO-6.
16. Arbitration A means of transferring to the insurance company the insured's
right to collect from a negligent third party.
17. Flood Definition under NFIP Generally includes mudslides, runoff of surface water, and over-
flow of tidal waters.
18. Insurance Binder Validity In Alabama, it is valid for 30 days or until a policy is issued,
whichever is less.
19. Coverage D under Homeown- Contains coverage for loss of use.
er's Policy
20. Subrogation A means of transferring to the insurance company the insured's
right to collect from a negligent third party.
21. Casualty Insurance Includes liability insurance.
22. Personal Property Valuation Under the Dwelling forms, personal property is generally valued
at Actual Cash Value.
23. Insurable Risk Characteristics There must be uncertainty of loss.
24. Insurance Premiums Considered to be trust funds received by the producer in a
fiduciary capacity.
25.
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