The writing of insurance policies for loss of life, limb or property has come a long way since 1688 when a group of shipowners, underwriters and merchants met at Lloyd's coffee shop in London to write and sell insurance.
Today, people and companies can insure just about anything, a practice made famous by Lloyd's of London and their willingness to take on great risks for their policyholders.Over time, insurance companies have sought a variety of areas for which to write policies - with mixed results.
The first automobile insurance ever issued was in 1898 by The Travelers Insurance Co. of Hartfold, Conn. The recipient, Truman J. Martin of Buffalo, N.Y., paid a premium of $11.25 for liability coverage ranging from $5,000 to $10,000. Today, of course, most people are covered by auto insurance and for premiums a bit more hefty.
Group insurance is a common form of coverage. But it wasn't in 1912 when the first major contract was written for the 3,000 people working at Montgomery Ward & Co. of Chicago. Vassar College had the honor of being the first college to cover its students with group insurance: 565 students enrolled voluntarily and for $12 were covered for the school year.
Some insurance companies have separated themselves from the pack in finding innovative approaches to underwriting. In 1950, the American Associated Insurance Cos. of St. Louis offered baby sitters' insurance. Sitters working through the Missouri State Employment Service were bonded up to $2,500 against fraud and dishonesty.
The Tobacco Growers' Mutual Insurance Co. of North Canaan, Conn., became underwriters for insurance against hail damage to tobacco crops in 1880. But it must have been an off decade for hail. The company went out of business in 1887.
Insurance companies also began getting creative in their policy artwork despite the serious, businesslike nature of underwriting. Yet such an adventure into the world of graphics came late to the industry: the first insurance company to illustrate their policies was the Allstate Insurance Co. of Chicago, and they were issued in the spring of 1947.
Today we have whole life, term life and universal life. Yet, life insurance started out quite simply, at least in terms if not in name.
The first life insurance company was the Corporation for the Relief of Poor and Distressed Presbyterian Misters and of the Poor and Distressed Widows and Children of Presbyterian Misters: a real mouthful for any insurance broker.
The company was formed in 1759 in Philadelphia, and survivors received an annuity on the death of the policyholder.
Given the complexity of our lives, insurance policies are now beginning to reflect all that can go wrong and how such occurrences will be compensated. But it is clear that such specificity in claiming benefits is not a modern-day invention.
One need only recall the accident insurance policy taken out by a James Bolter of Hartford, Conn., for $1,000 in 1864. The policy specified that Bolter was only covered during his walk from the post office to his home. The premium was a reasonable two cents, and the policy was agreed upon orally.
Nice way to plan a safe trip to the post office.