Essay on Proximate Cause

1222 Words May 22nd, 2013 5 Pages
Proximate Cause’ is defined as “The active, efficient cause that sets in motion a chain of events, which brings about a result, without the intervention of any new or independent force” Life itself is full of events, sometimes occurring independently of each other or as a result of another. The principle, proximate cause identifies for insurance purposes, which event is the probable cause of a particular event, leading to a loss and whether this event is insured.
Usually, the first and last events can be easily indentified but it is any intermediate events and causes, which happen, that may be more tricky to determine.
The event chain must be carefully considered at each stage, questions as to whether that particular chain was
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Storm, smoke and water are not excluded nor mentioned as insured in a fire policy. It is possible for a water damage claim to be covered under a fire policy, if for example, a fire occurs and the fire brigade extinguishes it with water.
Indirect Causes
Some policies sometimes exclude a peril if it is caused directly or indirectly by another one.
Concurrent Causes
There are losses whereby it is clear that more than one event has occurred at the same time, contributing to the loss. If there is no excepted peril involved and the causes cannot be identified or the parts of the loss seperated, then ALL the damage will be insured. If the losses can be filtered, then the appropriate settlements will be made, if insured.
If an excepted peril is involved in loss involving concurrent causes and the damage cannot be seperated then NONE of the loss is insured. If it can, then only the insured part of the damage is covered.
Illustrations:
As one is aware, every policy has a set of perils that are covered and another longer list of perils that are excluded. In fact, while deciding to opt for an Insurance policy, what you actually decide is to protect yourself against is the financial losses you may suffer due to a set of certain perils.
Take, for example, a home owner choosing a Fire policy and skipping a Machinery

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