Which event is typically categorized as a natural peril?

Flood is categorized as a natural peril because it results from natural events such as heavy rainfall, snowmelt, or hurricanes that lead to an overflow of water onto normally dry land. Natural perils encompass a variety of phenomena caused by the forces of nature, including floods, earthquakes, hurricanes, and tornadoes, which can all cause significant damage to properties and assets.

In contrast, fraud, theft, and default on loans are not classified as natural perils. Fraud and theft are human-induced events involving unlawful actions that result in financial loss or property damage. Default on loans pertains to financial obligations and does not relate to any natural event, making it a separate category entirely. Understanding the distinction between natural perils and other forms of risk is crucial for effective risk management and insurance coverage considerations.