Which term refers to the cause of a loss?

The term that refers to the cause of a loss is perils. In the context of insurance, perils are specific risks or events that can cause damage or loss to property or lead to liability. Common examples of perils include fire, theft, vandalism, and natural disasters like floods or earthquakes. These are the actual occurrences that lead to a claim being filed under an insurance policy.

Risk, on the other hand, refers to the uncertainty regarding loss; it is the potential for an event to cause a loss but does not specify what that event is. Hazard pertains to a condition that increases the likelihood of a peril occurring, such as a wet floor that could lead to slips and falls. Lastly, a loss event describes the specific occurrence of a peril resulting in a loss, but it doesn’t define what causes the loss as clearly as perils do.