Alabama Property and Casualty Practice Exam

In Property and Casualty policies, what is the part of the policy that names the insured, the property to be covered, and the policy limit called?

1. policy face

2. insuring agreements

3. declarations

4. conditions

The correct answer is: declarations

The portion of a Property and Casualty policy that names the insured, specifies the property to be covered, and outlines the policy limit is known as the declarations. This section serves as the introductory part of the policy, providing essential information in a clear and concise manner. It establishes the who, what, and how much of the coverage, making it a critical reference point for policyholders and insurers alike. The declarations play a crucial role as they set the groundwork for the insurance contract, defining the scope of coverage that the insured can expect. By clearly stating the limits, it allows policyholders to understand the maximum amount that can be claimed under the policy, helping them assess their coverage sufficiency in relation to their risk exposure.