Since but-for causation is very easy to show (but for stopping to tie your shoe, you would not have missed the train and would not have been mugged), a second test is used to determine if an action is close enough to a harm in a "chain of events" to be legally valid.
Proximate cause is a key principle of insurance and is concerned with how the loss or damage actually occurred.
[6] In the United Kingdom, a "threefold test" of foreseeability of damage, proximity of relationship and reasonableness was established in the case of Caparo v Dickman (1990) and adopted in the litigation between Lungowe and others and Vedanta Resources plc (Supreme Court ruling 2019).
[9] It does not matter how foreseeable the result as long as what the negligent party's physical activity can be tied to what actually happened.
It is the strictest test of causation, made famous by Benjamin Cardozo in Palsgraf v. Long Island Railroad Co. case under New York state law.
[10] The first element of the test is met if the injured person was a member of a class of people who could be expected to be put at risk of injury by the action.
[citation needed] The main criticism of this test is that it is preeminently concerned with culpability, rather than actual causation.
It begins with a special note explaining the institute's decision to reframe the concept in terms of "scope of liability" because it does not involve true causation, and to also include "proximate cause" in the chapter title in parentheses to help judges and lawyers understand the connection between the old and new terminology.
The Institute added that it "fervently hopes" the parenthetical will be unnecessary in a future fourth Restatement of Torts.
The classic example of how ACC clauses work is where a hurricane hits a building with wind and flood hazards at the same time.
If the evidence later shows that the wind blew off a building's roof and then water damage resulted only because there was no roof to prevent rain from entering, there would be coverage, but if the building was simultaneously flooded (i.e., because the rain caused a nearby body of water to rise or simply overwhelmed local sewers), an ACC clause would completely block coverage for the entire loss (even if the building owner could otherwise attribute damage to wind v. flood).