Alabama Property and Casualty Practice Exam

Which coverage can be found in all Homeowners forms but in no unendorsed Dwelling policies?

1. Wind

2. Hail

3. Vandalism

4. Theft

The correct answer is: Theft

The inclusion of theft coverage in all homeowners forms and its absence in unendorsed dwelling policies is a critical distinction. Homeowners insurance is designed to cover a broader range of risks specific to residential properties, and theft is a significant concern for homeowners. By incorporating theft coverage, homeowners policies offer protection against losses stemming from burglary, larceny, and other forms of theft – risks that are particularly relevant for individuals residing in their homes. On the other hand, unendorsed dwelling policies focus primarily on the physical structure of the home and generally do not include personal property protection or liability coverage, which encompasses theft. Those who hold dwelling policies may need to purchase additional endorsements to cover personal property losses, including theft. This fundamental difference highlights the broader protective scope of homeowners insurance compared to dwelling policies.