Our insured owns an apartment complex. One building suffered an electrical fire at approximately 9:00 A.M. The fire caused enough smoke and electrical systems damage so that all of the tenants had to be evacuated.

Before the now-empty building could be secured, children entered one of the apartments through unlocked doors and set a second fire at approximately 6:00 P.M. The insured carried a $10,000 per occurrence deductible on the property policy. Are the two fires one occurrence requiring one deductible or were they two occurrences requiring separate $10,000 deductibles?

The insured argues for one occurrence, saying that had it not been for the first fire, there would have been no second fire. He says there was an unbroken chain of causal events between the two fires.

Texas Subscriber

Unfortunately for your insured, the two fires are two separate occurrences and require two $10,000 deductibles. There is a difference between causation and proximate causation. While events arising out of the first fire set the stage for the second fire, the second fire did not spread from the first fire. The first fire did not ignite the second fire; the cause of the second fire was vandalism.