How is a peril defined in insurance terms?

In insurance terminology, a peril is defined as a cause of loss. This refers to specific events or situations that can lead to a loss or damage that is covered under an insurance policy. Common examples of perils include fire, theft, flood, or windstorm. Understanding perils is crucial because they delineate the boundaries of what an insurance policy will cover.

The other options, while related, don't accurately define a peril. A specific type of damage would describe the effects of a peril rather than the cause itself. A form of covered incident is too vague and does not precisely convey that a peril specifically refers to the source of the loss. A restriction to coverage pertains to limitations within the policy or exclusions and is not related to the concept of a peril. Recognizing the distinction helps to clarify how insurance policies are structured and what risks they are designed to mitigate.