1-H Cause & Loss

Question 1

Proximate Cause

Answer 1

When there is an unbroken chain of events between an occurrence and a loss, then the occurrence is the proximate cause of the loss

Question 2

Occurrence

Answer 2

An event, incident, or condition that causes damage; unexpected events that cause damage
Example: vandal; breaking a window or lightning striking a house or hail damaging a car

Question 3

The Original Occurrence

Answer 3

Causes damage which leads to more damage; the proximate cause of all resulting losses
Example: a car crashed into a house, house catches on fire, water does even more damage when putting it out

Question 4

A proximate cause can determine what ________ are covered by a policy

Answer 4

Losses

Question 5

Losses/damages are covered if:

Answer 5

• caused by a covered Peril

- their proximate cause was a covered Peril

Question 6

Direct Loss

Answer 6

Physical harm to tangible property, caused by the peril

Question 7

Indirect Loss

Answer 7

An economic loss that results from a direct loss

Question 8

Direct Loss vs. Indirect Loss

Answer 8

• direct: physical damage

- indirect: added expenses/lost income because of physical damage ( hotel room bill)