In the case of a factory fire caused by an earthquake, what is considered the proximate cause of the resulting loss?

In the scenario presented, the proximate cause of the loss refers to the primary event that set into motion the series of events leading to the damage. In this case, the earthquake is identified as the proximate cause because it is the initial event that triggers the subsequent occurrences.

When an earthquake occurs, it can result in various secondary effects, such as the rupture of gas lines and the release of gas, which may lead to a fire. However, these are not the events that directly initiated the loss; rather, they are consequences stemming from the earthquake. The fire, while ultimately responsible for the destruction of the factory, would not have occurred without the earthquake breaking the gas main.

By establishing the earthquake as the proximate cause, we recognize that it is the original event that is most directly linked to the loss of the factory, making it the primary cause of the destruction which followed. Understanding proximate cause is essential in insurance contexts, as it directly relates to liability and the extent of loss coverage under an insurance policy.