Page 63 - Insurance Surveyors Book Ebook IC S01

Survey And Loss Assessment IC-S01

to the negligence of the ship owner. In this case the insurance company will pay the

insured the full claim amount but will reserve the right to recover the amount from

the ship owner who was responsible for the loss. Once the loss is paid to the insureds

all the rights and liabilities of the insured will be transferred to the insurer and

insured cannot claim in future any amount from the ship owner.

According to the principle of contribution if there are more than one policy for the

same subject matter the insured will get only the actual claim amount. He cannot

recover separately from different insurance companies. Each insurer pays the

proportionate amount of loss suffered by the insured.

Proximate cause

According to the concept of proximate cause the loss will be paid only if it is caused

by the most active and efficient cause and it is insured under the policy. The

proximate cause may be defined as the active and efficient cause that sets in motion

a train of events which brings about a result, without the intervention of any forces

started and working at actively from a new and independent source.

If there are more than one causes of insurance only the original cause which led

to the damage will be considered. The subsidiary cause though may not be

insured peril, even then the loss will be paid since the original cause was an

insured peril.

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