Which term describes a condition that can cause a peril to occur, such as a slick floor?

• A. Hazard
• B. Peril
• C. Named Perils
• D. Open Perils

Answer: (A)

In insurance, a hazard is a condition that increases the likelihood or severity of a loss, while a peril is the actual event that causes the loss. A slick floor is a hazard because it creates an unsafe condition that makes a slip more likely. The peril would be the slip or fall itself—the event that results in injury or damage. Named perils and open perils describe categories of covered causes of loss, not the conditions that raise risk, so they don’t fit the description. Therefore, the term that describes a condition that can cause a peril to occur is hazard.