Install GFCI where water is near

Why this rule exists

A GFCI compares current leaving on the hot with current returning on the neutral. If they differ by more than a few milliamps, because some is leaking to ground through a person, it trips in a fraction of a second. That threshold, about 4 to 6 milliamps, sits below the let-go level, so it interrupts a shock before your muscles lock or your heart stops. It does not care whether the ground path is a wire or your body. Near water, it is often the last thing between a fault and a fatality.

In practice

Install GFCI protection on circuits serving bathrooms, kitchens, garages, basements, outdoors, laundry, and anywhere near sinks or wet locations, as the NEC requires and expands each cycle. Protect at the receptacle or the breaker, and test after installation with the built-in button and a plug-in tester. Press the test button monthly; a GFCI that will not trip on test is failed and must be replaced. Do not remove GFCI protection because it keeps tripping, since a repeatedly tripping GFCI is usually reporting a real fault.

Example

Hot out: 8.000 A   Neutral back: 8.000 A
Difference: 0 A -> normal, no trip
Fault: 6 mA leaks to ground via a person
Hot 8.006 A vs neutral 8.000 A
Imbalance 6 mA >= trip threshold (~5 mA)
Trips in ~25 ms, below the let-go level

When it doesn't apply

GFCIs protect against ground faults, not overloads or line-to-neutral shock, so they complement but do not replace breakers and insulation. Some equipment with inherent leakage causes nuisance trips; the fix is correcting the leakage, not defeating the device. GFCI protection does not require an equipment ground to work, which is why it legitimately protects ungrounded retrofits.