Insurance in America: A History
Here at Fudge Insurance we like to be in touch with our roots. In July, we celebrate the birth of our nation, the United States of America, and we thought it would be fun to take a look back at the history of insurance in America, as well as other forms of insurance. Take a little walk through time with us, wont you?
Home insurance
In 1752, Benjamin Franklin (yes, that guy!) founded the Philadelphia Contributorship for the Insurance of Houses from Loss by Fire, which is still America’s oldest, continuously operating insurance company. Though there was one insurance company founded in America in 1736 in Charles Town, South Carolina (modern-day Charleston, SC), it burned down and went out of business in 1740.
The Philadelphia Contributorship actually hired surveyors to go take a look at homes when the owners requested a policy. If the home didn’t meet their insurable standards, such as being made of brick and not wood, and free of trees in front of the house since early hoses could not be made to go around them, the coverage was denied.
If the house passed inspection, a rate was set and agreed to by the purchaser, and a seven-year renewable policy was written for the structure. The Contributorship even hired a chimney sweep to clean the chimneys of insured homes.
Life insurance
The Presbyterian Synods in Philadelphia and New York City formed the Corporation for Relief of Poor and Distressed Widows and Children of Presbyterian Ministers, the first life insurance company in America, in 1759. The name is a bit unwieldy so it was later shortened to the Presbyterian Ministers Fund. In 2002, it’s parent company was acquired by Nationwide Mutual Insurance Company.
Accident & health insurance
The Franklin Health Assurance Company of Massachusetts created the first form of medical insurance in 1850. At the time, it was specifically intended to cover injuries that occurred while traveling. These insurance plans did not cover the cost of actual medical care. Rather, the plans covered the lost income from missed wages while recovering from sickness or injuries.
Auto insurance
Travelers Insurance Company issued the very first auto insurance policy in the US in 1898 to a doctor named Truman J. Martin of Buffalo, New York. That first policy gave Dr. Martin $5,000 in liability coverage and cost him $12.25.
In 1925, Massachusetts passed the first legislation requiring automobile insurance for drivers as a prerequisite to registering a vehicle. For over 30 years, Massachusetts was the only state in America with a compulsory auto insurance law requiring insurance before registration.
Insurance today
The world of insurance is changing in many ways to keep up with the evolving needs of technology. But one thing is still the same as what our founding fathers intended. Protecting what we care about and providing for troubled times is still at the heart of the insurance industry.
Even if you don’t realize it yet, insurance is important for all areas of your life, especially when it concerns factors that are out of your control, like unexpected health issues or being in a car accident.
If you have questions about your insurance needs, please contact us so we can help protect your property, just as Ben Franklin intended at our country’s founding.
