Alabama Property and Casualty Practice Exam

Which of the following is an example of a peril typically covered by property insurance?

1. Vandalism

2. Theft

3. Fire

4. All of the above

The correct answer is: All of the above

Property insurance is designed to protect against a variety of risks that could damage or destroy property. A peril refers to a specific risk or cause of loss that an insurance policy can cover. In this case, fire, theft, and vandalism are all considered perils that can lead to damage or loss of property. Fire is one of the most common perils covered by property insurance. It can cause extensive damage to buildings and personal property, making it a critical risk that insurance policies typically address. Theft is another peril that property insurance frequently covers. If someone unlawfully takes your property, such as personal belongings or business assets, the insurance can help reimburse you for your losses depending on the policy's terms. Vandalism, which involves the intentional destruction or damage of property, is also typically covered by property insurance. This coverage protects policyholders from the financial repercussions of malicious acts that lead to property damage. Given that all three perils—fire, theft, and vandalism—are scenarios that property insurance is designed to protect against, it follows that the correct answer encompasses all of these perils as covered risks. Therefore, the option indicating that all are examples of covered perils accurately reflects the comprehensive nature of property insurance coverage.