Page 13 - MODULE1_Insurance Introduction_CHA

4. History of Insurance

In ancient time, risk was often seen through the lens of

fate and met with acceptance rather than defiance. Protecting

against misfortunes was perceived equivalent to interfering with

divine providence. For thousands of years, prayers, pilgrimages

and donations outperformed insurance premiums. Indeed, as

th
late as the 19 century, insuring against death was likely to

arouse controversy among clerics.

But there were acceptable ways of alleviating losses, such

as sharing risks within social and business communities. Risk

mitigation based on solidarity was widespread among guilds,

trade associations, and village communities.

The first methods of transferring or distributing risk in a

monetary economy were practised

rd
nd
by Chinese and Babylonian traders in the 3 and 2 millennia BC,

13