Question

The insurer is liable for insured perils only and not for unexpected uninsured ones. This is the principle of ______.

Options

• Indemnity

• Utmost good faith

• Subrogation

• Causa Proxima

Answer 1

The insurer is liable for insured perils only, not unexpected uninsured ones. This is the principle of Causa Proxima.

Explanation:

The doctrine of 'proximate cause' runs as 'causa proxima non-remota spectator', i.e., only immediate cause and not the remote cause is to be taken notice of, while determining the insurers' liability. It is not the latest but the direct, dominant and operative cause that shall be considered.