This is the second and concluding part of a series of article, on the origin and development of insurance. While the first part published in the previous month's issue of Insurance Chronicle dealt with Life Insurance, the present article throws light on the aspects relating to General Insurance Industry.
General Insurance (comprising of marine, fire, accident, motor, medical insurance) is more ancient compared to Life Insurance. It may look paradoxical, yet it is a fact that with the growth of civilization and international trade, insurance of property was thought of earlier than life insurance.
What is the distinction between assurance and insurance? In popular usage, the word insurance is used to include assurance also. Assurance is a solemn promise or guarantee and is used to denote life policies where a fixed sum assured is payable on death or survival (This is contractually payable). Usually, with a general insurance policy, benefit payable can vary and is not more than the actual loss subject to maximum of the sum assured. In case of insurance, the benefit is much less.
We read of interesting accounts of ancient commerce. Around 6000 years ago, Babylonians, whose home in the Tigris-Euphrates Valley lay at the crossroads of early world traffic, had developed business practices to a high degree. Babylon had become the clearing house of trade as all the important land trade routes converged in that territory. From Armenia in the North, China and India in the East, Egypt in the West, caravans came laden with merchandise. Though Babylon built-up a great commercial system, and her people were the first to enjoy the fruits of political economy, their territory was surrounded by huge tracts of desert
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