8. Doctrine of Proximate Cause

Question 1

When is proximate cause needed?

Answer 1

Cause of loss not easy to define as there is a chain of events or more than a single loss, apply to doctrine to look at the relationship between peril and loss

Question 2

What is the definition of proximate cause?

Answer 2

The active, efficient cause that sets in motion a train of events which brings about a result, without the intervention of any force started and working actively from a new and independent source

Question 3

Is proximate cause always the dominate cause?

Answer 3

Yes and there is a direct link between it and the resulting loss

Question 4

How do you identify the proximate cause?

Answer 4

Common sense

Question 5

What happens when the proximate cause is established?

Answer 5

Need to check if the peril is covered
- Insured perils (named in policy as covered)
- Excepted / excluded perils (named as specifically not covered)
- Uninsured / named perils (not mentioned)

Question 6

What happens if events before the loss are all insured perils?

Answer 6

Would not need to find the proximate cause and establish what category it falls into

Question 7

What happens if a loss is due to an uninsured peril?

Answer 7

Insurers liable only if proximate cause was an insured peril

Question 8

How can the doctrine be modified?

Answer 8

Policy wording such as the use of ‘indirectly caused by’