Insurance Policies: Identifying in the English Courts the Proximate Cause of a Loss

A Court of Appeal decision gives guidance on working out the proximate cause and how to deal with two causes of loss.

Almost 80 years ago, during World War II, a 1000kg high-explosive bomb fell on farmland near Exeter and did not explode. In 2012, the claimant's halls of residence were built about 200 metres away from the bomb, which was discovered by contractors in 2021. The authorities determined that the best way to deal with it was to diffuse the ordinance by carrying out a controlled "low order" explosion to split the casing and allow removal of the high explosive. However, that was unsuccessful and the high explosive detonated, damaging the claimant's properties.

The defendant in University of Exeter v Allianz Insurance insured the claimant for property damage and business interruption. As is typical for property cover, the policy contained a war-risks exclusion, for loss and damage "occasioned by war". The dispute concerned whether the loss had been caused by the enemy action during the war (excluded) or the failed attempt to diffuse the bomb (covered and last in time).

This course provides an insightful analysis of a Court of Appeal decision that offers crucial guidance on determining proximate cause and navigating scenarios involving dual causes of loss.

By the end of this course, you should be able to:

1. Understand the concept of proximate cause in insurance claims and its significance in determining coverage
2. Learn how to analyse scenarios involving multiple potential causes of loss