What is proximate cause in insurance?

Proximate cause in insurance refers to the primary cause of a loss, which is fundamental in determining whether a loss is covered under an insurance policy. It establishes a direct link between the cause of the loss and the event that triggered the insurer's obligation to pay. Understanding proximate cause is crucial because it helps delineate the circumstances under which coverage applies.

For instance, if a fire damages property, the proximate cause would be the fire itself, as it is the primary event that led to the loss. Insurers assess proximate cause to determine liability and the extent of coverage, ensuring that claims are handled fairly and according to the terms of the policy. This concept safeguards against claims related to losses that may have been influenced by distant or unrelated factors.

The other options do not capture the essence of proximate cause accurately. The remote cause of an accident suggests a lack of direct connection to the loss, which does not apply in the context of insurance. The insurer's obligation is more about contract law and policy terms than the concept of cause. Lastly, subsidiary causes pertain to contributing factors but do not represent the primary cause that establishes the basis for coverage. Thus, the choice that accurately reflects the meaning of proximate cause is indeed that it