Peril Law and Legal Definition

Peril means exposure to the risk of injury, damage or loss. Under Insurance law, it means the cause of a risk of loss to person or property. The cause of a risk can be fire, accident, theft, forgery, earthquake, flood or illness.

Perils insured against refers to the kinds of risk against which the insurance is granted. Most of the insurance policies will have specific recitals regarding the perils insured against and exclusions. Generally basic perils include fire, lighting, windstorm or hail, explosion, riot or civil commotion, aircraft, vehicles, smoke, vandalism and malicious mischief, theft and volcanic eruption.

Example of a case law ( Florida) clarifying the term “perils insured against”

Farmers Mutual Hail Insurance Company of Iowa v. Stansbury, 291 S.W.2d 347 (Tex.Civil App.1956) involved an action on a standard form automobile insurance policy giving comprehensive coverage on a trailer. A trailer wheel came off its axle solely as the result of mechanical breakdown or failure, and the wheel and trailer then came together in such a manner that the wheel entered the trailer, causing damage to the interior thereof. The court held that the carrier was not responsible for the insured's loss because no peril insured against has come into play causing or contributing to cause the breakdown or failure which in turn causes or contributes to a resultant loss; - or where the breakdown or failure is not followed or accompanied by the coming into play of a peril insured against which in turn causes or contributes to a resultant loss; - the loss and damage resulting from the breakdown or failure is not covered by the policy. This is true despite the provision in the 'exclusion' that the only damage excluded is that 'due and confined' to mechanical breakdown or failure." [Fireman's Fund Ins. Co. v. Cramer, 178 So. 2d 581, 583 (Fla. 1965)]