The principle of insurance was adopted first in Britain five hundred years ago by ship-owners and merchants who sent cargoes by sea. Maritime ventures were perilous in those days as Antonio, the Merchant of Venice, found to his cost, so a trader would effect a `policy of assurance' against the perils of the seas.
Assurance is the old word for insurance and is still used sometimes today.
The policy would be signed by a number of individuals, each of whom undertook to accept liability for a stated proportion of any loss.
Because they signed at the bottom of the policy they were called underwriters.
After the Great Fire of London in 1666 people's thoughts turned to insurance as the best way of protecting themselves against the consequences of fire. In 1680 a scheme was set on foot to provide venturesome company offered to insure the contents of buildings against fire as well. That company (the Sun Fire Office) is still in business today as part of the Sun Alliance and London Insurance Group.
Over the centuries the insurance principle was applied to more and more types of unpleasant events. The coming of the railways led to a demand for insurance against injury in train accidents. Employers sought protection against claims by their servants for injury in accidents at work. In the twentieth century insurance was needed by motorists to cover both loss of or damage to their cars and their legal liability to anyone who might be injured in a road accident.
Aviation insurance also grew up in the twentieth century.
People began to insure their property against theft or even, in the case of valuables, against accidental loss.
Insurance proved to have a host of applications.
The state adopted the principle of insurance for all against the risks of sickness and unemployment. Today every worker is covered by social security, formerly called national insurance, which in return for small contributions, provides for payments to those who are prevented from working. Mankind is constantly finding new uses for insurance. One need only instance insurance for spacecraft and for the oil rigs in the North Sea which may be covered for as much as £5 Billion.
In another field the need to put forward a single view on behalf of insurance arose in an acute form. The European Economic Community aims at creating a common market for goods and services throughout its member countries.
The ideal is that all EEC companies and citizens should be able to compete on equal terms in any EEC country regardless of their nationality.
This is easy to state but less easy to carry out.
In insurance, for example, each EEC country regulates insurers in a different way.
The EEC seeks to remove impediments to a common market but... see: International Bodies
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