Proximate Cause: S-01 Chapter 4
Find the cause that set the loss in motion, not the last thing that happened. Then check the policy.
Most losses have more than one cause. A storm lifts a factory roof; that night rain pours in and ruins the stock; next morning a worker slips on the wet floor. A surveyor has to say which of these caused the loss being claimed, because the policy pays only if that cause is covered.
The rule is proximate cause: look for the dominant, effective cause that set the chain of events in motion. It is not necessarily the last event before the loss. In the example the rain did the damage, but the storm that tore off the roof is the proximate cause of the wet stock.
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Key Terms
- But-for cause
- A cause without which the loss would not have happened. Easy to show and too wide on its own: but for the shop opening that day, nothing would have burned.
- Proximate cause
- The predominant cause that sets in motion the chain of events producing the loss. The legal and insurance test that narrows the but-for list to one effective cause.
- Intervening cause
- A new event that breaks the chain. It must be independent of the original cause, be a voluntary human act or an abnormal natural event, and come between the original cause and the loss.
- Anti-concurrent causation clause
- A policy clause saying that if a covered and an uncovered cause combine to cause a loss, the loss is not covered at all.
The Surveyor's Four Questions
How chapter 4 turns into a site visit.
- 1
What happened, in order?
Build the chain of events from the evidence: site inspection, statements, fire brigade or police records, weather data.
- 2
Which event started the chain?
Find the cause that set the rest in motion, not the one nearest in time to the damage.
- 3
Did anything break the chain?
Look for a new, independent cause between the first event and the loss. If there is one, the loss is judged on that new cause.
- 4
Is that cause covered?
Read the policy: is the proximate cause a named peril, or an exclusion? Then comment on admissibility, and if the claim is not payable, give the reasons in the report.
Applied: A Fire Policy That Excludes Flood
Illustrations. Real outcomes always depend on the wording.
Short circuit starts a fire that damages stock
Proximate cause
Fire
Covered?
Yes
Fire brigade's water damages stock on the floor below
Proximate cause
Fire: the water is part of the chain it started
Covered?
Yes
River flood soaks the godown; stock rots
Proximate cause
Flood
Covered?
No: excluded
Fire is put out; a week later an unrelated burglary takes salvaged goods
Proximate cause
Burglary: a new, independent human act
Covered?
Judged on burglary cover, not fire
Storm and flood hit together; the damage cannot be separated, and the policy has an anti-concurrent causation clause
Proximate cause
Both
Covered?
No: the clause blocks the whole loss
| What happened | Proximate cause | Covered? |
|---|---|---|
| Short circuit starts a fire that damages stock | Fire | Yes |
| Fire brigade's water damages stock on the floor below | Fire: the water is part of the chain it started | Yes |
| River flood soaks the godown; stock rots | Flood | No: excluded |
| Fire is put out; a week later an unrelated burglary takes salvaged goods | Burglary: a new, independent human act | Judged on burglary cover, not fire |
| Storm and flood hit together; the damage cannot be separated, and the policy has an anti-concurrent causation clause | Both | No: the clause blocks the whole loss |
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The Roof and the Rain
A storm blows the roof off a building and rain then soaks the inside. If the evidence shows the water got in only because the roof had gone, the storm is the proximate cause and storm cover responds. If the building was flooded at the same time by rising water, and the policy carries an anti-concurrent causation clause, the whole loss can fall outside cover. The surveyor's evidence on what happened first decides which.
Where Proximate Cause Matters Most
It is a general insurance principle. A basic life policy pays on death without asking which event caused it, so the chain-of-events test is a fire, marine, engineering and motor claims tool. That is why it sits in S-01 next to indemnity and types of loss: the surveyor names the cause, names the loss, then measures it.
The Trap in S-01 Questions
Do not pick the last event in time. Ask which cause set the chain in motion, then whether anything new and independent broke it. Only then check the policy.
FAQs
What is proximate cause in insurance?expand_more
The dominant, effective cause that sets in motion the chain of events leading to a loss. The policy pays if that cause is an insured peril and not excluded.
Is the proximate cause the last cause?expand_more
Not necessarily. Rain that soaks stock after a storm tears off the roof is the last event, but the storm is the proximate cause.
What breaks the chain of causation?expand_more
A new, independent cause: a voluntary human act or an abnormal natural event coming between the first cause and the loss. The loss is then judged on the new cause.
Does proximate cause apply to life insurance?expand_more
It is used in general insurance claims. A basic life policy pays on death without a chain-of-events test.
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