What is proximate cause in insurance? (With Examples)

Have you ever wondered what is a proximate cause in insurance? Wonder no more, this article will explain to you the concept of proximate cause (closest cause) in detail with 2 easy to understand examples.

Proximate cause is one of the elemental principles of insurance. It deals with finding out what is the closest/first cause of the loss. This principle states that the closest cause for any particular loss will be considered when it comes to making an insurance claim payment.


For instance, Mr. Rishi has taken a fire insurance policy for his workshop. Let us assume that his workshop caught fire and Mr. Rishi filed a claim with the insurance company.

Upon investigation, the insurance company found out that the proximate cause (closet cause) of the fire was a minor earthquake in that area which lead to the warehouse ceiling collapsing upon the electric meter, which then caused the fire.

Under the terms of the fire insurance policy, earthquakes were not covered and the earthquake being the proximate cause of the loss, Mr. Rishi’s claim was rejected.

Let us understand the concept of proximate cause with another simple example.

Example 2

Let us assume that Mr. Shakuni took an accidental insurance policy. While walking on the road, Mr. Shakuni had a heart attack, which caused him to collapse and get hit by a car.

While making a claim, it was noted that the proximate cause of the loss was a heart attack which lead to the accident. Since heart attack was not covered in Mr. Raj’s accidental policy, the insurance company rejected Mr. Raj’s claim.

Thus if Mr. Raj would have taken a comprehensive health insurance policy his claim would have been accepted as the proximate cause (closest) of the loss was the heart attack and not an accident.

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