What is one example of a peril?

A peril refers to a specific risk or danger that can cause loss or damage to property or individuals. In this context, fire is a clear and identifiable hazard that can lead to destruction of property, injury, or loss of life. It represents a tangible threat that can be insured against, reflecting a key concept in risk management.

Understanding this definition is crucial because it distinguishes perils from other concepts that might be related to risk. Financial assurance, operating conditions, and investment opportunities do not represent natural or man-made threats that can directly result in loss but rather pertain to broader aspects of business or investment management. Therefore, fire stands out as a direct example of a peril that can trigger a risk management response, making it the correct choice in this context.