The beginning of car insurance
02/02/2016
Yesterday is said to have been the 118th anniversary of the first car insurance policy. It's amazing how early people thought of insuring themselves against the risks associated with driving.
The first auto insurance policy was issued on February 1, 1898 to Dr. Truman Martin of Buffalo, NY. He was driving a Columbia Electric and paid USD 11.25 for liability coverage.
However, there had already been a previous case in which someone wanted to insure himself against automobile risks. The man's name was Gilbert L. Loomis and he received a policy for his car, but it described horse-drawn carriage cover and therefore did not qualify as primary car insurance. The insurance company "Travelers" got a taste for it and developed the first liability motor vehicle insurance product, so to speak. The rest is history and, of course, the insurance companies in Europe followed suit, as the advertisements (above) show ...
And here's a hint for our "everything used to be better" faction: Dr. Martin paid USD 11.25 for a maximum claim amount of USD 10,000. Today we insure ourselves 100 or rather 1000 times higher. Thank goodness premiums have not risen proportionally ...
And one more note: today, insurance for classic cars (and youngtimers) is good business, not because the premiums are high, but because the claims ratio is very low.
