find a broker

Find a Broker

FR

LoginMy Account
Western Financial Group Western Financial Group
  • Personal

    Home Insurance

    Home Insurance

    Condo Insurance

    Renter's Insurance

    Seasonal Property Insurance

    Mobile Home Insurance

    Vehicle Insurance

     

    Car Insurance

    Motorcycle Insurance

    RV Insurance

    Boat Insurance

    ATV Insurance

    Snowmobile Insurance

    Vehicle Replacement Insurance

    Health & Life Insurance

    Life Insurance

    Disability Insurance

    Critical Illness Insurance

    Mortgage Life Insurance

    Financial Insurance

     

    TFSA

    GICs

    RESPs

    RRSPs

    Travel Insurance

     
  • Business

    Commercial Insurance

     

    Business Insurance

    Business Life Insurance

    General Liability Insurance

    Commercial Property Insurance

    D&O Liability Insurance

    Rental Property Insurance

    Legal Protection Insurance

    Errors & Omissions Insurance

    Cyber Liability Insurance

    TotalProtect Insurance

    Fleet Insurance

    Farm Insurance

    Product Liability Insurance

    Employee Benefits

    Employee Benefits

    TotalGuard Insurance

    Group Insurance 

     

    All Insurance Programs

    AMM Municipal Insurance Program

    CRA Insurance Program

    CVMA Insurance Program

    Crop Inputs Insurance Program

    Haven Municipal Insurance Program

    Hospitality Insurance Program

    Juno Restaurant Insurance

    BCRFA Restaurant Insurance

    Groupex Insurance Partnership

    CAM Movers Insurance

    Musical Instrument Insurance

    Independent Retail Insurance

    CAMA Insurance Program

    Biz Benefits Partnership

     

    Event Liability Insurance

     

    Charity Events or Fundraising Insurance

    Conferences and Conventions Insurance

    Corporate Events and Seminars Insurance

    Farmers’ Market Insurance

    Festival Insurance

    Hole-in-one Contest or Golf Tournaments Insurance

    Product Launches and Promotional Events Insurance

    Sporting Event Insurance

    Wedding Insurance

    Industries

    Cannabis

    Construction

    Contractors

    Daycares

    Greenhouses

    Hotels and Motels

    Manufacturing

    Municipalities

    Professional Services

    Property Management

    Retail

    Restaurants, Cafes, Delis, Fast Food

    Skilled Trades

    Technology

    Welders

  • Services

    MyWestern

    Payment Setup

    Registry Services

    Community Emergency Resources

    Personal Insurance Claims

    Commercial Insurance Claims

    Risk Management

  • About Us

    About Western

    Who We Are

    Executive Team

    Divisions

    Partners

    Western Coast Insurance

    Wyatt Dowling Insurance

    Sustainability

    Diversity, Equity and Inclusion

    Western News

    Blogs

    Careers

    Contact

    Communities Foundation

    Our Giving Programs

    About the Foundation

    Annual Giving Reports

    Annual National Walk

    Community Infrastructure Grants

    Foundation FAQs

    Sponsorship

    Western Communities Foundation

    Your donation will help improve local communities.

    Donate

1-866-860-1958

Get a Quote

Get a Quote

Main Menu

  • Personal
    • Home Insurance

      • Home Insurance

      • Condo Insurance

        Renter's Insurance

        Seasonal Property Insurance

        Mobile Home Insurance

    • Vehicle Insurance

       
      • Car Insurance

      • Motorcycle Insurance

        RV Insurance

        Boat Insurance

        ATV Insurance

        Snowmobile Insurance

        Vehicle Replacement Insurance

    • Health & Life Insurance

      • Life Insurance

        Disability Insurance

        Critical Illness Insurance

        Mortgage Life Insurance

    • Financial Insurance

       
      • TFSA

        GICs

        RESPs

        RRSPs

    • Travel Insurance

       
  • Business
    • Commercial Insurance

       
      • Business Insurance

      • Business Life Insurance

        General Liability Insurance

        Commercial Property Insurance

        D&O Liability Insurance

        Rental Property Insurance

        Legal Protection Insurance

        Errors & Omissions Insurance

        Cyber Liability Insurance

        TotalProtect Insurance

        Fleet Insurance

        Farm Insurance

        Product Liability Insurance

    • Employee Benefits

      • Employee Benefits

        TotalGuard Insurance

    • Group Insurance 

       
      • All Insurance Programs

        AMM Municipal Insurance Program

        CRA Insurance Program

        CVMA Insurance Program

        Crop Inputs Insurance Program

        Haven Municipal Insurance Program

        Hospitality Insurance Program

        Juno Restaurant Insurance

        BCRFA Restaurant Insurance

        Groupex Insurance Partnership

        CAM Movers Insurance

        Musical Instrument Insurance

        Independent Retail Insurance

        CAMA Insurance Program

        Biz Benefits Partnership

         
    • Event Liability Insurance

       
      • Charity Events or Fundraising Insurance

        Conferences and Conventions Insurance

        Corporate Events and Seminars Insurance

        Farmers’ Market Insurance

        Festival Insurance

        Hole-in-one Contest or Golf Tournaments Insurance

        Product Launches and Promotional Events Insurance

        Sporting Event Insurance

        Wedding Insurance

    • Industries

      • Cannabis

        Construction

        Contractors

        Daycares

        Greenhouses

        Hotels and Motels

        Manufacturing

        Municipalities

        Professional Services

        Property Management

        Retail

        Restaurants, Cafes, Delis, Fast Food

        Skilled Trades

        Technology

        Welders

  • Services
    • MyWestern

      Payment Setup

      Registry Services

      Community Emergency Resources

      Personal Insurance Claims

      Commercial Insurance Claims

      Risk Management

  • About Us
    • About Western

      • Who We Are

        Executive Team

        Divisions

        Partners

        Western Coast Insurance

        Wyatt Dowling Insurance

        Sustainability

        Diversity, Equity and Inclusion

        Western News

        Blogs

        Careers

        Contact

    • Communities Foundation

      • Our Giving Programs

        About the Foundation

        Annual Giving Reports

        Annual National Walk

        Community Infrastructure Grants

        Foundation FAQs

        Sponsorship

LoginMy Account

FR

1-866-860-1958

Get a Quote

Find a Broker

The history of insurance

Insurance. Whose idea was it anyway?

Insurance is the act of paying for financial coverage in case an accident or a loss happens. When you think about it, it might seem like a strange idea to pre-pay for something that hasn’t happened, but the practice of insurance – spreading the cost of risk – has been around nearly as long as humans have walked the earth.

Early hunting parties would go out in groups to spread the risk of one lone hunter being gored to death by a wild animal. Later when Chinese traders tired of losing their valuable wares in shipwrecks, they would divide their goods across several vessels to spread out the loss if one sank. Each boat carried a mix of cargo from several merchants. A single shipwreck meant a slight loss for all rather than a crippling loss for one.

In Babylon around 1750 BC, King Hammurabi enacted a different type of insurance called “bottomry”. Merchants were allowed to finance their shipping through loans from lenders. Upon safe arrival of the goods, merchants were required to pay back the loan, with interest. However, if the merchandise met with an unfortunate incident along the way, the merchant didn't have to pay back a cent. Considering the very high risk, the calculated interest on the loan was exceptionally high.

The “Hammurabi Code” was carved into a Babylonian obelisk monument making it one of the first written insurance policies.

Group coverage

The concept of group coverage emerged in the Middle Ages through the trades. The masters, who would train apprentices in the trades, paid dues to a guild. The guilds’ coffers were a type of insurance fund. If a master suffered misfortune, the guild would step up with any assistance necessary. The guild would rebuild his building in the event of a fire, cover his obligations if he was robbed, and support him and his wife and family if he became disabled, or died.

Life insurance

The origins of the concept of life insurance can be traced to ancient Rome. The Romans had strong beliefs when it came to one’s burial. Anyone improperly buried would become an unhappy ghost. So it was critical that every deceased person, regardless of social standing, receive a proper burial. To that end, burial clubs were created. Eventually the clubs evolved to provide financial aid to survivors of the deceased.

Fire insurance

In 1666, when many insurance companies were focused on marine insurance, there was a great fire that effectively gutted the medieval city of London inside the old Roman City Wall. It is estimated that it destroyed the homes of 70,000 of the city’s 80,000 inhabitants. Out of the ashes rose groups of insurers who saw the great need for fire insurance, and quickly expanded their business offering.

Underwriters

Near the end of the seventeenth century, London was becoming the centre of trade. In the late 1680s, Mr. Edward Lloyd opened Lloyd’s Coffee House and it became a gathering place for ship owners, merchants and captains. It was also a destination for parties who wanted to insure ships and cargo, and therefore profit from the trade.

Insurance proposals were drawn up, and at the bottom were the signatures of individual insurers along with the amount of risk they were assuming. Hence the term underwriter.

A single voyage would have multiple underwriters, who would also spread their risk by taking shares in several different voyages.

Of course, Mr. Lloyd went on to form Lloyd’s of London, a renowned insurance market made up of financial underwriters who come together to pool and spread risk.

Auto insurance

In 1897, before Henry Ford brought his cars to the masses, a man by the name of Gilbert J. Loomis built himself a car in Westfield, Massachusetts. His rough version of a “sleigh on wheels” caused some commotion as he attempted to weave around pedestrians and horse-buggies. He decided to protect himself and everyone else by getting the first auto insurance policy from Travelers Insurance Company (part of the Lyman Agency).

Even as more vehicles took to the streets, the car was still a novelty and no standard policies existed for them. The first car insured at Lloyd's in 1901 was actually covered by a marine policy. The policy for the car was written on the basis that it was a ship navigating on dry land.

Years later, in 1956, when there were significantly more cars on the road, Massachusetts became the first state to require automobile owners to purchase car insurance.

The laws of probability

Probability is the lifeblood of the insurance industry. Probability enables actuaries to calculate risk for events that are relevant to insurance such as the risk of an extreme weather event or a vehicle accident.

The concept of expressing probabilities was discovered in 1654 by Blaise Pascal - a Frenchman who invented the calculator - and his friend Pierre de Fermat. Their work led to the first actuary tables that are still used today when calculating insurance rates.

In 1693, astronomer Edmund Halley pioneered the first mortality table, which accurately predicted the likelihood of death based on one’s current age – making it easier and more affordable to establish life insurance premiums. The table, corrected in 1756 by Joseph Dodson, made it possible to scale the premium rate to age; previously the rate had been the same for all ages.

The simple idea of spreading risk to reduce loss in ancient times has led to the development of modern-day insurance. Now interwoven into all aspects of our lives, it is the very reason that so many people enjoy the peace-of-mind that insurance coverage brings today.

GET A QUOTE

Recent Blog Posts

Mark Missal Farm Insurance
Western's Farm Insurance Has Roots in Our Communities

May 8, 2025


Spring Cleaning Boat
Why You Need to Clean Your Boat in the Spring

May 7, 2025


Car Kill Switch Theft Prevention
Will a Kill Switch Stop My Car from Being Stolen?

May 5, 2025


Western Financial Group

2025 Western Financial Group. All rights reserved.

Privacy / Legal | Accessibility Guidelines | Fair Treatment of Customers Policy | Terms of Use | Compensation Disclosure | Complaints Process | Media Relations | Mergers & Acquisition | Careers | Sitemap