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The Origins of Insurance: How did ancient civilizations protect themselves from risk?
With the development of civilization, society's demand for risk management has gradually increased. Insurance, as a risk management tool, has gradually formed and developed. How ancient people used various innovative methods to resist sudden risks became the prototype of the foundation of today's insurance system.
Methods for early risk transfer
As early as 3000 BC, traders in China and India began practicing risk transfer. In order to offset the losses caused by ship capsizing, Chinese merchants often transported their goods across multiple ships.
Article 238 of the Code of Hammurabi stipulates that the captain of a ship only needs to pay the ship owner half of the value of the ship if he saves the ship from total loss.
The Birth of Marine Insurance
Between 1000 and 800 BC, the General Rules of Marine Insurance on the island of Rhodes marked an important stage in the founding of insurance. These laws are based on the principle of general average, which states that loss of cargo and ship in the event of distress at sea is not borne entirely by one party but is shared by all those with a fair interest.
The evolution of insurance
As time goes by, the form of insurance has gradually evolved. In the 14th century, Genoa in Italy became the first place to launch insurance contracts independent of loans, and insurance pool systems began to emerge, which were based on guarantees of land assets. The first known insurance contract dates back to 1347.
In 1583, the Royal Exchange in London signed the world's first life insurance contract, providing insurance coverage for the late William Gibbons.
Fire and the Development of Insurance
The Great Fire of London in 1666 was a major turning point in the history of insurance. The fires destroyed more than 13,000 homes, transforming insurance from an optional convenience to an urgent need. After that, the first fire insurance company was established and began to provide insurance coverage specifically for houses.
The rise of modern insurance
In the early 18th century, life insurance policies became popular and the first companies dedicated solely to life insurance were established. With the rise of railways, accident insurance emerged in the 19th century to specifically protect against damage caused by accidents.
Social Impact and Modernization
Entering the 20th century, the insurance industry continued to innovate. Germany and the United Kingdom were the first to establish national insurance programs and develop various types of social insurance to protect people's lives in illness and old age.
"The development of the insurance industry around the world is not only a driver of the economy, but also plays an indispensable role in shaping social structure and protecting individual rights."
Contemporary insurance concepts
Today, insurance has become an indispensable part of the operation of society. Many countries have established special organizations to regulate and promote the development of the global insurance industry. All of this stems from ancient humans' profound understanding and response to unknown risks.
Regarding how ancient civilizations ingeniously designed strategies to combat risks, have you ever imagined how these methods would continue and change in today's insurance system?
