Notes on Proximate Cause

The concept of “proximate cause” refers to the manner in which the actual loss or damage occurred to the insured party and whether it was the outcome of an insured peril. The first thing that is investigated is how the loss occurred and whether the case was covered by insurance. One of the six guiding principles in the world of insurance is called the doctrine of proximate cause.When it comes to claim administration and, more specifically, evaluating the playability or otherwise of a claim on the topic of dangers covered by a policy, the concept of proximate cause is almost at the centre of all that goes on.Certain dangers, referred to as insured perils, may be covered by an insurance policy. Other dangers, referred to as excepted perils, may not be covered by the policy at all, while others, identified as uninsured perils, may not be covered either by the policy or the exceptions it contains.This is not usually that cut and dry to determine if a loss was brought on by a single insured or uninsured or an excepted hazard, which would determine whether a claim would be paid out or not paid out.Challenging circumstances arise whenever a variety of risks are simultaneously engaged, some of which are insured, some of which are uninsured, and some of which are nonetheless taken.

Proximate Cause Insurance Definition

The Principle of Causa Proxima, also known as the Proximate Cause Principle, is among the six essential principles of insurance, as well as its focus is on identifying the causes of damage in an insurance claim which is the most proximate, nearest, or immediate of all possible causes.A cause is said to be proximate when it is the cause which is efficient and effective in creating or setting in motion a chain of events that finally brings forward an outcome. It is possible for the proximate cause to be the initial cause or the final cause; but, its definition requires that it be the cause which is most actively responsible for producing the result.When determining the extent of the insurer’s liability, the proximate cause is the first factor taken into account. Thus, if the direct cause of damage is a recognised risk that is covered by insurance, the insurer is required to compensate the insured for their loss.

It denotes that the insurer is obligated to make the compensation payment to the insured party if the immediate cause of the damage is covered by the insurance policy.

Application of Proximate Cause

 The concept of the “proximate cause” is an essential one in the world of insurance. It is used to determine the manner in which a loss or damage occurs, as well as whether it was brought about by an insured peril. The crucial consideration to make in this scenario is the fact that the proximate cause is the sole the nearest cause, but not the remote cause. It focuses primarily on the administration of claims and, more specifically, the diagnosis of the role that a peril plays in an insurance claim. When it comes to fire insurance, there are certain perils that are explicitly addressed insured perils, while other perils are excluded and are referred to as an exclusion. Additionally, some perils may be covered, while others may not. It is often not possible to determine whether the loss was caused by a single risk that was insured or one that was not. ln order to determine whether a claim is eligible to be paid out. When there are multiple potential dangers associated with a situation, various scenarios may play out, some of which provide protection while others do not.

Proximate Cause Insurance Example

• An intoxicated motorist causes an accident by weaving towards oncoming traffic and hitting another car. There is a connection between driving under the influence of alcohol and the accident.
• One of the customers falls because the workers didn’t clean up the spill that had occurred on the floor. They suffer a wrist fracture. The accident’s immediate root cause can be traced back to the spill that occurred on the floor.
• When a company does not take measures to restrict the number of customers who enter their location, the space on the ground level might become very congested. Due to the jostling, a customer accidentally knocks into another customer, causing them to tumble. Even if the customer was the one who actually led to the fall, the failure of the business to properly restrict the amount of visitors in its facility is the proximate cause of the fall, as well as the victim’s injuries that resulted from the fall.
• A retailer abandons a pallet of merchandise in the middle of an aisle. A client is out and about while texting on their mobile device. They crash through the pallet as well as fall to the ground. Even if the act of texting was a contributing factor to the accident, the fact that the pallet was left in the aisle was also a contributing factor.

Conclusion

The association between an incident and an injury is referred to as the injury’s “proximate cause.” In the framework of the law, in order to demonstrate legal responsibility, sometimes referred to as “liability,” there has to be a significant connection between an occurrence or act and the damage that has been caused as a result. The concept of causation refers to this relationship.The occurrence or behaviour that is most directly connected to an injury is referred to as the proximate cause of the damage. This does not imply that the questionable behaviour must have occurred at the earliest possible point in time before the harm. The concept of proximate cause restricts the amount of responsibility that may be placed on a defendant because any one action can have far-reaching and unpredictable repercussions.