Loss of chance
Damage compensated when a fault has destroyed a favorable possibility, recovery, winning a lawsuit, obtaining cover; the award is only a fraction of the final loss, measured by the lost probability.
The law requires damage to be certain to be compensated. Yet many faults do not cause certain damage but destroy a chance: the doctor who delays diagnosis does not necessarily cause death, but takes away a chance of survival; the lawyer who misses a deadline does not lose the case, but takes away the chance of winning it. French case law compensates this present and certain disappearance of a favorable possibility, provided it was real and serious. The award is never the final loss: it is a fraction of it, equal to the probability the judge considers lost. The concept lies at the heart of the liability of advisers and intermediaries. A broker or agent who fails in the duty to advise, and leaves the client without suitable cover, is not ordered to pay the uncovered loss, but the lost chance of having been insured, assessed by the probability that the client would have bought the right cover if properly advised. The same reasoning applies to failure to inform a patient of a surgical risk. For the professional liability insurer, loss of chance strongly modulates cost: it turns a potentially total loss into a partial award, but multiplies plausible claims.
Textbook case: a retailer suffers an 800,000 euro fire loss not covered for business interruption, a cover the broker never offered. The court puts at 60 percent the chance the retailer would have bought it if properly advised: the broker, and the broker's liability insurer, pay 480,000 euros.
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