The doctrine of proximate cause:
A) forces the insurer to pay for all claims arising out of an unbroken sequence of events if any one of the subsequent perils following the original excluded peril was covered
B) forces the insurer to pay for all claims arising out of an unbroken sequence of events if the original insured peril was covered
C) forces the insurer to pay for the loss when the proximate cause of the event is the insured's fault
D) divides any loss payment among parties proximately affected by the loss

Question

Quizplus · Accepted Answer

The doctrine of proximate cause states that the insurer is liable for a loss that is the immediate and direct result of a covered peril. Therefore, if the original insured peril was covered and resulted in an unbroken sequence of events leading to the loss, the insurer must pay for all claims arising out of it. Option A is incorrect because subsequent perils following the original excluded peril are not covered, and option C is incorrect because the insured's fault is not the sole determining factor for the insurer's liability. Option D is also incorrect as the doctrine of proximate cause does not divide loss payments among parties but rather identifies the cause of the loss.

The Doctrine of Proximate Cause