What is a common example of a peril in homeowners insurance?

The correct answer is theft, which is classified as a common peril covered under homeowners insurance policies. A peril refers to a specific risk or cause of loss that can lead to damage or destruction of property, which homeowners insurance is designed to protect against. Theft involves the unlawful taking of someone else's property, and homeowners insurance typically provides coverage for personal belongings that are stolen from within the home or on the property.

In contrast, high utility bills, wear and tear, and home equity do not qualify as perils. High utility bills are an expense and do not involve physical damage to the home. Wear and tear is considered a maintenance issue and not a sudden or accidental loss caused by a covered peril. Home equity refers to the market value of a home minus any outstanding mortgage balance, and it is not related to physical damage or risks that insurance would cover.