A peril
a specific cause of a loss.
A peril, in insurance terms, refers to a specific risk or danger that could result in a loss or damage to property, assets or life. Perils can include natural disasters such as hurricanes, floods or earthquakes, as well as human-made perils such as fire, theft or vandalism.
Insurance policies typically identify specific perils that are covered, and may also exclude certain perils or aspects of a peril. For example, a homeowner’s insurance policy may cover wind damage, but may exclude tornado damage. It’s important for policyholders to carefully review their insurance policies and discuss any questions or concerns with their insurance provider.
Insurers use information about perils and risks to assess the likelihood of a loss occurring and to set premium rates. Properly assessing and managing perils is essential for insurers to effectively protect their policyholders.
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