Tuesday, January 20, 2015

How The Concept Of Insurance Developed

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Did you know that the earliest concept of insurance existed among merchants since the ancient era? In as early as 3000 BC, Chinese merchants distribute their goods in different vessels to minimize their loss because of possible capsizing. During 2000 BC, Babylonian traders also have their own method of transferring and distributing risks and such system can be found in the Code of Hammurabi. 

Due to the risks involved while traveling at sea, merchants continued to develop an insurance system that will allow them to limit their loss. During the 14th century, insurance contracts were created. Genoa pioneered such contracts in 1347. Then came the development of maritime insurance a century later. The first marine insurance company was put up by Edward Lloyd by the name of Lloyd's Coffee Shop.

As time passed by, various kinds of insurance have been developed to address different risks involved in the ever-changing environment. There were life insurance policies in the 18th century, the accident insurance in the 19th century, the national insurance programs by the government against old age and sickness.

To this date, almost everything can be insured. Various properties like cars, houses, lands, and even businesses need to be insured according to laws in some countries. In fact, even professionals need one. Due to several lawsuits filed by customers or clients against professional service providers, the professional indemnity insurance has been created to cover professionals in a variety of industries.

Trivia Info Resource: reapi.com.au

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