Horror involves more than simple fright. It entails revulsion and anguish. Often it arises when adventurer see something completely contrary to the common understanding of what can and should occur in the world, or upon the realization of a dreadful truth. In such a situation, you can call on characters to make a Charisma/Sanity saving throw to resist the horror. Set the DC based on the magnitude of the horrific circumstances. On a failed save, a character gains a short-term or  longterm form of madness that you choose or determine randomly, as detailed in chapter 8 , “Running the Game.”