New York State Life Insurance Exam Questions Practice Question
While texting and driving, an insured loses control of the vehicle and hits a tree. The resulting collision is
Correct Answer: C
Rationale: The situation described involves an event that directly causes damage, which qualifies as a peril. A peril refers to a specific risk or cause of loss, such as a collision.
Option A, exposure, relates to the potential for loss but does not denote an actual event. Option B, hazard, refers to a condition that increases the likelihood of a peril occurring, like distracted driving, but is not the event itself. Option D, risk, encompasses the possibility of loss but is broader and less specific than a peril. Hence, the collision resulting from texting and driving is accurately classified as a peril.
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