General

A Brief History of Life Insurance

Summary

Since individuals needed programs that would protect their families financially, life insurance was born. People have been benefiting from it for thousands of years. Yes, the concept was introduced long ago! Here’s a brief history. Ancient Roots Funerals have always […]

Since individuals needed programs that would protect their families financially, life insurance was born. People have been benefiting from it for thousands of years. Yes, the concept was introduced long ago! Here’s a brief history.

Ancient Roots

Funerals have always been expensive, with ancient Romans not being exempt from this problem. It was a huge dilemma because they believed that people who weren’t buried properly turned into evil spirits.

People recognized that no one deserved that fate, so they formed clubs where they gave monthly contributions. When a member died, they used the resources to cover the burial costs. Soon, surviving family members also received stipends from these organizations.

With the empire’s fall, this honorable concept also disappeared for some time. But, it seems like other civilizations followed the famous proverb and practiced what the Romans did because they adapted the idea later on.

Early Records

It was only in 1583 that the first insurance policy was recorded when Richard Martin bought one for William Gybbons. The former paid 30 euros to 13 merchants for a contract stating that if his friend died within a year, they would give him 400 euros. Although it was a bet in today’s standards and wasn’t as noble as the Romans’ intentions, it was considered the beginning of protection plans.

More than a century later, Edward Lloyd’s Coffee House in London became a popular place for people to gather and get the latest shipping news. As time went by, individuals began sharing information about maritime insurance. This was the start of modern policies.

In 1759, the first insurance company in the United States was established. Its goal was to provide monetary support to bereaved family members. But, many individuals didn’t like the idea because they felt as if the person’s worth was being measured. There were also restrictions given to policyholders, such as regulated travel and alcohol prohibitions.

Pressing Need

When a fire broke out in New York in 1835, people began recognizing how difficult it was to recover from financial losses due to accidents. This happened again in Chicago 36 years later, which echoed the need for protection plans that provided support for those facing sudden economic damage.

The first US company that made insurance policies more accessible to the working class was founded in 1875. Like its predecessor, it aimed to give monetary provisions to surviving family members. Many people were already aware of the importance of this program, so they supported the organization.

In 1976, around 72% of adults in the US already owned life protection policies. The industry continued to expand as people wanted to help their dearest ones in the event of an untimely passing. Today, different plans include various benefits, such as funds for education.

Life insurance policies have come a long way since their humble origin in ancient Rome. If there’s one thing that hasn’t changed, it’s the desire to help people finance huge expenses. Individuals who want to get a plan should contact trusted advisors with their best interests at heart.

There are two main things that weigh on seniors as they get older. One, they want to make sure that their families are protected after they’re gone. They do that with life insurance. Two, they want to make sure they are cared for and that the biggest burden of that care doesn’t fall on their loved ones. So, they shift that responsibility to home care agencies in San Diego instead.

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