Which of the following increases the chance of a loss?

The correct choice is hazard, as hazards are conditions or situations that increase the likelihood of a peril occurring. In the context of insurance, a peril refers to the actual cause of a loss, such as fire, theft, or natural disasters. Hazards can be classified into different categories, such as physical hazards (e.g., icy sidewalks), moral hazards (e.g., dishonesty), and morale hazards (e.g., carelessness).

When hazards are present, they create an environment where losses are more likely to occur, ultimately affecting the risk assessment and premium calculations by insurance companies. Therefore, understanding hazards and how they contribute to the overall risk is critical in the insurance industry.

In contrast, exposure refers to the extent to which something is at risk for loss; it does not inherently increase the chance of a loss but rather quantifies the level of risk associated with specific situations or assets. Perils themselves do not increase the chance of a loss; they are the source of the loss when a hazard is present. Insurance serves to mitigate the financial impact of losses but does not increase the likelihood of a loss occurring.