The difference between water and lateral hazards
A water hazard is marked in yellow, lateral in red. If you aren’t going to attempt to play from the hazard — and unless you have a clean shot, we advise you don’t — you are facing a one-shot penalty.
For a water hazard, a player has three options:
Go to the designated drop area (not all hazards have this).
Identify where your ball last crossed the water hazard, then drop as far back as you want from that spot and the pin.
Play your next shot by dropping a ball nearest to the point where your last stroke was played. You can re-tee if it was your first shot.
A lateral hazard is slightly different. Like with yellow stakes, you have to identify where the ball crossed into the hazard. However, you are given a two clubs length area to drop. You can also go on the other side of the hazard — assuming no closer to the hole — and drop there as well.