What type of insurance covers losses from unforeseen events like floods or fires?

The correct answer is related to the mechanism by which insurance policies are designed to protect individuals and businesses from financial loss due to unexpected events. Casualty insurance, as a term, encompasses a variety of coverages that protect against loss due to accidents and certain types of mishaps, including the liability for injuries to other people or damage to property. However, it primarily covers aspects of liability rather than direct loss from unforeseen disasters.

For the context of covering losses specifically from events like floods or fires, property insurance is the most accurate designation. Property insurance is designed to cover damage to or loss of physical property from perils such as fire, theft, and natural disasters. It focuses specifically on the protection of tangible assets and the losses resulting from unforeseen events affecting that property.

This distinction is key; casualty insurance might include liability related to damages incurred but does not offer the direct coverage for the property damage itself. Hence, in scenarios of property damage from unforeseen events like floods or fires, property insurance would be the more appropriate form of protection.