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🎲 '''Fortuity''' is the foundational insurance principle that a [[Definition:Loss | loss]] must be accidental and unforeseen — at least from the [[Definition:Policyholder | insured's]] perspective — in order to be covered under an [[Definition:Insurance policy | insurance policy]]. The concept distinguishes insurable events from certain or intentional ones: insurance is designed to spread the financial consequences of uncertain future events across a pool of similarly situated risks, not to compensate for outcomes the insured knew would occur or deliberately caused. Courts frequently invoke fortuity when adjudicating [[Definition:Coverage dispute | coverage disputes]], particularly in cases involving [[Definition:Environmental liability | environmental contamination]], construction defects, and [[Definition:Professional liability insurance | professional liability]] claims where the line between accidental and expected harm can blur.

🔍 In application, the fortuity requirement appears in policy language through terms like "accident," "occurrence," and "unexpected and unintended" — each carrying specific legal weight that varies by jurisdiction. A [[Definition:Commercial general liability (CGL) insurance | commercial general liability]] policy, for example, typically defines an "[[Definition:Occurrence | occurrence]]" as an accident resulting in [[Definition:Bodily injury | bodily injury]] or [[Definition:Property damage | property damage]] that the insured neither expected nor intended. When an insured knew about a defective condition before purchasing coverage but failed to disclose it, the insurer may deny the [[Definition:Claim | claim]] on fortuity grounds — arguing that the loss was not fortuitous because the insured had prior knowledge of the risk. [[Definition:Underwriting | Underwriters]] assess fortuity implicitly during the application process, relying on accurate representations from the applicant to ensure that the risk being priced genuinely involves uncertainty.

⚖️ Fortuity protects the economic integrity of the insurance mechanism itself. If insurers were obligated to cover losses that were certain to occur, [[Definition:Premium | premiums]] would need to equal the full cost of the loss plus expenses — which is not insurance but prepayment. The principle also guards against [[Definition:Moral hazard | moral hazard]] and [[Definition:Adverse selection | adverse selection]], discouraging applicants from purchasing coverage only after they know a loss is imminent. In disputed claims, the burden of proof on fortuity varies: some jurisdictions require the insurer to prove the loss was expected or intended, while others place the initial burden on the insured to demonstrate that the loss was fortuitous. For [[Definition:Claims adjuster | claims adjusters]] and coverage counsel, fortuity analysis is often the first step in evaluating whether a reported loss triggers policy coverage at all.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Occurrence]]
* [[Definition:Insurable interest]]
* [[Definition:Moral hazard]]
* [[Definition:Adverse selection]]
* [[Definition:Utmost good faith]]
* [[Definition:Exclusion]]
{{Div col end}}

Definition:Fortuity - Revision history

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