The insurer is liable to compensate only when fire is the proximate cause of damage or loss.

True

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False

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Solution

The correct option is A True
The principle of proximate cause states that when the subject matter of the contract is damaged due to more than one cause, then the most proximate cause should be considered. Proximate cause means the most direct or the most dominant or most effective cause that has caused the mishap.

As we know that the fire insurance covers the loss or damage caused by fire. Thus, in such case the insurer shall be liable to compensate the insured only when fire is the proximate cause of damage.

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Similar questions

Which of the function explains the following :

After the insured is compensated for the loss or damage to the property insured by him or her then the right of ownership of such property is passed on to the insurer.

State the following statement is True or False:

Insurer undertakes to compensate the loss suffered by insured.

Which principle states that it is the duty of insured to take reasonable steps to minimise the loss or damage to the insured property?

Mention which function explains the following:

It is the duty of the insured to take reasonable steps to minimise the loss or damage to the insured property.

State the following statement is True or False:

The principle of insurance under which the compensation paid to the insured which is equal to the actual loss is indemnity.

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