What term is used to describe a condition that increases the possibility of loss?

The term that describes a condition that increases the possibility of loss is "hazard." In the context of insurance and risk management, a hazard refers to any factor that can increase the likelihood of loss occurring. Hazards can take various forms, including physical hazards (like a wet floor), moral hazards (such as dishonest behavior), and moral hazards (indifference towards insured items).

Understanding this concept is essential for adjusters because identifying hazards is a key part of assessing risks and determining the potential for loss related to an insured property or event. This assessment helps insurance companies set appropriate premiums and manage their risk exposure effectively.

The other terms have specific meanings within the field as well. Risk generally refers to the broader concept of uncertainty associated with a loss occurring. Liability relates to the responsibility for a loss or injury to another party. Exposure represents the extent to which an organization or individual is subject to loss, typically in terms of value or the types of risks to which they're exposed. While these terms are related, "hazard" most directly aligns with the idea of conditions that heighten the likelihood of loss.