Insurance Terms Defined: Hazardous

Hazardous: risk from accidental loss, including the possibility of loss or no loss.

Hazardous events are what make insurance both so necessary and so expensive at the same time.  The definition of a hazardous event is something that was caused by accident with the possibility of there being a loss or no loss. 

Think of this with your auto insurance property damage liability coverage.  Your insurance company tells you that they will pay X amount of dollars if you have an accident that was your fault and was “accidental”.  They have no way of knowing for sure the possibility that you will have this loss, but they can make educated guesses.