Alabama Property & Casualty Insurance License Exam Overview
The Alabama Property & Casualty Insurance License Exam is administered by the University of Alabama testing centers on behalf of the Alabama Department of Insurance. Alabama's Gulf Coast exposure and tornado alley location create specialized insurance needs that require knowledgeable P&C agents.
Passing this exam qualifies you to sell property insurance, auto insurance, liability coverage, and related products throughout Alabama—a state with nearly 5 million residents, significant hurricane exposure along the coast, and tornado risks that create substantial P&C insurance demand.
Exam Format at a Glance
| Component | Details |
|---|---|
| Total Questions | 125 multiple-choice |
| Scored Questions | 125 |
| Time Limit | 2 hours |
| Passing Score | 70% (88 correct answers) |
| Testing Vendor | University of Alabama |
| Exam Fee | $75 |
| Pre-licensing Education | Not required (recommended) |
Why Get P&C Licensed in Alabama?
- Growing market — Nearly 5 million residents
- Gulf Coast exposure — High-value coastal property market
- Tornado coverage demand — Frequent severe weather events
- Lower barriers — Only 20 hours pre-licensing required
- Competitive compensation — Average P&C agent salary over $55,000
Start Your FREE Alabama P&C Exam Prep
Ready to begin studying? Our comprehensive, completely free Alabama P&C exam prep covers everything you need to pass.
Key Topics Covered on the Exam
1. Property Insurance (30%)
Homeowners Insurance:
- HO-2, HO-3, HO-4, HO-5, HO-6, HO-8 policy forms
- Coverage A (Dwelling), B (Other Structures), C (Personal Property)
- Coverage D (Loss of Use), E (Personal Liability)
- Dwelling fire policies
Alabama-Specific Property Topics:
- Alabama FAIR Plan (Beach and Windstorm Underwriting Association)
- Hurricane and windstorm coverage
- Tornado damage coverage
- Flood insurance requirements (coastal areas)
- Wind/hail deductibles
Commercial Property:
- Building and personal property coverage forms
- Business income coverage
- Equipment breakdown
- Inland marine coverage
2. Liability Insurance (30%)
Personal Liability:
- Homeowners liability (Coverage E)
- Personal umbrella policies
- Medical payments coverage
Commercial Liability:
- Commercial General Liability (CGL)
- Products and completed operations
- Professional liability (E&O)
- Workers' compensation requirements
Alabama Workers' Compensation:
- Required for employers with 5 or more employees
- State Fund available through private insurers
- Self-insurance options available
- Exemptions for certain agricultural and domestic workers
3. Auto Insurance (25%)
Alabama Auto Insurance Requirements:
| Coverage | Minimum Limit |
|---|---|
| Bodily Injury (per person) | $25,000 |
| Bodily Injury (per accident) | $50,000 |
| Property Damage | $25,000 |
Additional Auto Topics:
- Personal Auto Policy (PAP) coverage parts
- Alabama financial responsibility law
- Uninsured motorist coverage (optional but recommended)
- Underinsured motorist coverage
- SR-22 requirements
- Commercial auto insurance
4. Alabama Insurance Code and Regulations (10%)
Title 27 Key Provisions:
- Producer licensing requirements
- Unfair trade practices
- Unfair claims settlement practices
- Policy cancellation and nonrenewal rules
- Advertising guidelines
Licensing Requirements:
- Pre-licensing education: 20 hours
- Continuing education: 24 hours every 2 years
- Ethics requirement: 3 hours included in CE
- Background check required
5. Ethics and Professional Conduct (5%)
- Fiduciary duties to insureds
- Premium handling requirements
- Claims reporting obligations
- Privacy and confidentiality
Study Timeline for Success
| Week | Focus Area | Hours |
|---|---|---|
| Week 1 | Property insurance fundamentals | 10-12 |
| Week 2 | Liability insurance | 10-12 |
| Week 3 | Auto insurance and AL requirements | 10-12 |
| Week 4 | Alabama regulations (Title 27) | 8-10 |
| Week 5 | Practice exams and review | 10-12 |
Total recommended study time: 50-60 hours
Free Practice Questions Available
Test your knowledge with hundreds of free practice questions designed specifically for the Alabama P&C exam.
Alabama-Specific Exam Tips
1. Know Alabama Auto Minimums
Alabama requires 25/50/25 liability coverage:
- $25,000 per person bodily injury
- $50,000 per accident bodily injury
- $25,000 property damage
2. Master Hurricane and Windstorm Coverage
Alabama's Gulf Coast exposure is critical:
- Alabama Insurance Underwriting Association (AIUA) — Residual market for coastal properties
- Wind/hail deductibles — Often percentage-based
- Named storm deductibles — Separate from standard deductibles
- Flood exclusion — Separate NFIP policy required
3. Understand Tornado Coverage
Alabama's tornado alley location:
- Tornado damage covered under standard HO policies
- Debris removal coverage important
- Additional living expenses coverage
- Replacement cost vs. ACV considerations
4. Key Numbers to Remember
| Topic | Alabama Requirement |
|---|---|
| Auto minimums | 25/50/25 |
| WC threshold | 5+ employees |
| Pre-licensing | 20 hours |
| CE requirement | 24 hours/2 years |
| Passing score | 70% |
Common Mistakes to Avoid
- Confusing wind and flood coverage — Flood requires separate NFIP policy
- Not knowing AIUA — Alabama's coastal residual market
- Underestimating tornado content — Major Alabama exposure
- Wrong WC threshold — Alabama requires WC at 5+ employees
- Not practicing timed exams — 2 hours for 125 questions
- Cramming last minute — Spread study over 4-5 weeks
After Passing Your Exam
- Apply for license through Alabama Department of Insurance
- Complete background check — Required for all applicants
- Pay license fee — Approximately $80 for resident license
- Affiliate with insurer — Get appointed by carrier
- Maintain CE compliance — 24 hours every 2 years
- Begin selling — Your license is valid for 2 years
2026 Alabama Updates
For 2026, be aware of:
- Coastal property insurance rate changes
- Hurricane coverage updates
- Auto insurance rate adjustments
- Enhanced consumer protection regulations
Start Your Alabama P&C Insurance Career Today
The Alabama P&C license opens doors to a growing insurance market with significant coastal and severe weather opportunities. With proper preparation, you can pass the exam on your first attempt.
Our free study materials include:
- Complete topic coverage
- Practice questions with explanations
- Alabama-specific regulations (Title 27)
- Study guides and summaries
- AI-powered study assistance
Don't pay for expensive prep courses when everything you need is available FREE.