Article Authored by Michael Clark in Today’s Daily Business Review: “Court Upholds Concurrent Cause Doctrine in Win for Property Policyholders”

Siegfried Rivera
January 12, 2017


Firm partner B. Michael Clark, Jr. authored a guest column that appeared as a “Board of Contributors” feature in today’s edition of the Daily Business Review, South Florida’s exclusive business daily and official court newspaper.  The article, which was titled “Court Upholds Concurrent Cause Doctrine in Win for Property Policyholders,” focused on the positive ramifications for Florida commercial and residential insurance policyholders of the state Supreme Court’s recent decision in the case of Sebo v. American Home Assurance.  Michael’s article reads:

The recent Supreme Court of Florida decision in Sebo v. American Home Assurance rejecting the “efficient proximate cause doctrine” in favor of the “concurrent cause doctrine” for property insurance claims represents a significant win for residential and commercial policyholders.

The state’s highest court has determined that the appropriate theory of recovery for claims in which two or more perils contribute to a loss but at least one of the perils is excluded from coverage is the concurrent cause doctrine. Under the rejected efficient proximate cause theory, when multiple perils cause a loss, it is the efficient cause — the one that sets the other in motion — to which the loss is attributed.

For the insurance industry, the efficient proximate cause doctrine has always been preferred. If the carriers are able to demonstrate that the efficient cause behind a loss is excluded from coverage under the policy, then the entire claim may be denied.

Sebo makes the concurrent cause doctrine the legal standard to be applied for property insurance claims in Florida. Now insurers must cover a loss even if the covered peril is the secondary cause of the loss, which was concurrent with but not the primary or efficient cause.

Michael’s article concludes:

This decision represents a significant positive milestone for policyholders in Florida. Because of the nature of many property losses in the state, especially those coming as a result of hurricanes in which both wind and flood damage occur, concurrent causes are very common for property damage claims.

If the Second DCA’s decision were allowed to stand, property claim litigation would have been greatly exacerbated by tests to determine the efficient proximate causes. Some insurers would simply use the doctrine to issue initial claim denials, making it incumbent upon their insureds to prove coverage.

The key question now is whether the carriers will respond to the ruling by including more or stronger anti-concurrent-cause language in their policies, which is often already present.  In light of the ruling, policyholders should consult with qualified insurance professionals and attorneys to review their policies for clauses calling for the application of the efficient proximate cause doctrine over the concurrent cause doctrine. They should make their coverage decisions with a clear understanding of what their current policies provide.

Our firm congratulates Michael for sharing his insights into this important decision for Florida property insurance policyholders with the readers of the Daily Business ReviewClick here to read the complete article in the newspaper’s website (registration required).