General Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 1/5
A windstorm tears the roof off a house and the homeowner files a claim. For insurance classification purposes, the windstorm is the:
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
A peril is the actual cause of loss: wind, fire, theft, or accident. Here the windstorm is the event that caused the damage, so it is the peril. Hazards are conditions that increase the chance of a peril occurring, such as icy roads or faulty wiring. The policy defines which perils are covered, and coverage attaches when a named peril actually causes the loss.
Why the other options are wrong
- A) A hazard is a condition that increases the likelihood of loss; the windstorm itself is the cause of loss, not a condition.
- B) A moral hazard is dishonesty that increases loss, such as arson; no dishonest motive is described in the scenario.
- C) A speculative risk offers a chance of gain or loss; a windstorm offers only the possibility of loss, making it a pure risk, not a speculative one.
Memory hook
Peril = the event that does the damage (wind, fire). Hazard = the condition that makes it more likely.