What Is Burden Of Proof?

Burden of proof is a legal standard that requires parties to demonstrate that a claim is valid or invalid based on facts and evidence presented. Burden of proof is typically required of one party in a claim, and in many cases the party that is filing a claim is the party that must demonstrate that the claim is valid and carry the burden of proof.

Key Takeaways

  • The burden of proof is a legal requirement that determines the viability of a claim based on the factual evidence produced.
  • Typically the onus for burden of proof lies with the party initiating or filing a claim.
  • Burden of proof is used extensively in cases involving insurance claims or lawsuits involving financial malfeasance.

Understanding Burden Of Proof

The burden of proof requirement is designed to ensure that legal decisions are made based on facts rather than by conjecture. As a result, the party bringing a case or lawsuit to court must often back up their claims with facts and evidence, physical or otherwise.

As in all civil cases, the ruling is based on a preponderance of the evidence—i.e. more than 50% of the evidence provided must point to something useful in determining whether the case should proceed. Burden of proof and collection of evidence is part and parcel that lawyers engage in to collectively bill millions of hours for every year.

In insurance, it is used in the courts to determine whether a loss is covered by an insurance policy. Typically, the insured has the burden of proof to demonstrate that a loss is covered under the policy, while the insurer has the burden of proof to demonstrate that a loss was excluded under the terms of the policy contract.

Sorting Out Insurance Claim Responsibility

Insurance companies will often use the courts to determine which company is responsible for providing coverage when more than one insurer is involved. This situation occurs in circumstances in which the insured has several different policies covering similar or related risks or when one party's insurance company sues another, for instance in the case of a car accident involving two or more vehicles.

The insurers are required to demonstrate either that the loss was caused by an event that was not covered under the policy, or that another insurance company is responsible for the coverage. The courts may decide that a particular policy is responsible for providing coverage, but may also determine that the different insurers are responsible for a portion of the loss.

Providing information to prove that insurance coverage applies can be complicated. For example, a homeowner's house is destroyed during a hurricane. The homeowner’s policy may provide coverage for losses caused by wind, but not by water. The insured must prove that the destruction was caused by wind damage, while the insurer will try to prove that the damage was caused by water. The courts may find that both types of risk caused the damage.

In a fair number of insurance cases that get to court, negligence is alleged. This has been defined as the failure to exercise reasonable care. Insurers will try to prove that the insured failed to do something a reasonable person would do, or conversely, did something a reasonable person wouldn't do.