Los Angeles Claims Adjuster Property and Causality Practice Exam

What doctrine allows an insurer to compensate for damages caused by multiple overlapping events?

1. Concurrent Causation Doctrine

2. Proximate Cause Doctrine

3. Subrogation Principle

4. Contribution Doctrine

The correct answer is: Concurrent Causation Doctrine

The correct answer is the Concurrent Causation Doctrine. This doctrine is significant in the realm of insurance because it addresses situations where multiple causes contribute to a single loss. When an event can be attributed to more than one cause, the Concurrent Causation Doctrine allows insurers to determine how to assign liability and compensate for the damages. For example, if a property damage claim involves both a storm and faulty construction, resulting in the same damage, the concurrent causation doctrine supports the idea that both factors contributed to the final outcome. Insurers can evaluate the extent of each cause and pay claims accordingly, without needing to isolate a single event as the sole cause of the damages. In contrast, other concepts like the Proximate Cause Doctrine focus on establishing a direct link between the cause and the effect, typically identifying the closest cause that led to the damage, rather than recognizing simultaneous contributing factors. The Subrogation Principle relates to the insurer's right to pursue a third party responsible for the loss after compensating the insured, and the Contribution Doctrine applies when multiple insurers are involved in covering the same risk, addressing how costs are shared among them after a loss occurs. Thus, while all these doctrines have their place in insurance, the Concurrent Causation Doctrine specifically encompasses