Proximate cause is a legal term used in law and insurance to determine the cause of an injury or damage. It refers to an event that is sufficiently related to an injury that the courts consider it to be the cause of that injury. There are two types of causation in the law: cause-in-fact and proximate cause. Cause-in-fact is determined by the "but for" test, which means that if the injury would not have occurred "but for" the action of the defendant, then there is cause-in-fact. However, since but-for causation is very easy to show, 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. This test is called proximate cause. Proximate cause is concerned with how the loss or damage actually occurred and is a key principle of insurance.

Proximate cause can be the most difficult issue in a personal injury case. Not every remote cause of an injury will result in a right to recover damages. For example, if a driver runs a red light, and another driver swerves to avoid being hit, but later hits a parked car, the driver of the parked car cannot claim that the actions of the driver who ran the red light caused their injury, as it is probably not the proximate cause.

There are several competing theories of proximate cause, including foreseeability, which is the most common test of proximate cause under the American legal system. It determines if the harm resulting from an action could reasonably have been predicted. The likelihood of calling something a proximate cause increases as the cause becomes more direct and more necessary for the injury to occur.

In summary, proximate cause is a legal term used to determine the cause of an injury or damage. It is concerned with how the loss or damage actually occurred and is a key principle of insurance. There are several competing theories of proximate cause, including foreseeability, and the likelihood of calling something a proximate cause increases as the cause becomes more direct and more necessary for the injury to occur.