How is casualty formally defined?

Casualty is formally defined as damage or loss that arises from a sudden and unexpected event. This reflects the nature of casualty insurance, which covers losses resulting from incidents like accidents, theft, fire, and other unforeseen events that can adversely affect property or people. The emphasis on being sudden and unexpected is crucial because it distinguishes these losses from those that are predictable or scheduled, which would not typically fall under the casualty category.

For instance, if a tree falls on a house due to a storm, that loss is considered a casualty event because it was unexpected and resulted in damage. Casualty insurance aims to provide coverage and financial protection against such unanticipated risks and perils, thus enabling policyholders to recover from the sudden impact of a loss without facing devastating financial consequences.