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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
Solution
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.
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