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Will an insurance company honour a claim if the loss was caused by a combination of proximate causes?

Mr. Wong’s cargo was found damaged after being shipped from Shanghai to Hong Kong. The survey report showed that damage to the cargo was caused by 2 factors: insufficient packing and rough handling. However, there was difficulty identifying which of the 2 factors had caused the damage.

Can Mr. Wong claim his loss successfully from a marine cargo insurance policy?

According to a decided case (Wayne Tank & Pump Co. Ltd v. Employers Liability Assurance Corp. Ltd), where the loss has multiple proximate causes and as long as only one is specifically excluded by the policy, the exclusion prevails and the insurance company is not liable for the loss.

In Mr. Wong’s case, although rough handling is an insured peril under Institute Cargo Clauses A, insufficient packing is specifically named as an exclusion. Therefore, Mr. Wong’s claim is not recoverable under his cargo insurance policy in accordance with the principle held in Wayne Tank’s case.

In order to minimise the loss and to deliver the cargo to the consignee’s warehouse on time, customers are advised to ensure that their cargoes are sufficiently well packed.

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