MARINE INSURANCE. The practice of marine insurance, at least on a purely commer cial basis. antedates by centuries the application of the insurance principle to other kinds of risks. Even in ancient times there was developed a system of quasi-insuranee in the form of loans on tiottomry by which risks were at least partially transferred. In the Middle Ages marine insur ance on a co tel.,' basis first appeared as early as the thirteenth century in Flanders and in Portugal. The oldest legal document relating to insurance which has come down to us consists of the ordinances issued by the magistrates of Barcelona in 1435 to regulate the business of marine insurance. Marine underwriting appears to have been introduced into England by the Lombard: early in the sixteenth century. By the eighteenth century that country had obtained the leading position in the business, which she has since maintained.
Viir many years marine underwriting in Eng land was carried on exclusively by unassociated individuals and continued to be conducted on a strictly individual basis until late in the eigh teenth century. The first step toward the regula tion of marine underwriting by the Lloyds Asso ciation tips) was taken in 1779. when a printed form of policy was adopted. practically the same as the one still in use. In 1871 the Imoyds Association was incorporated by net of Parlia ment. the articles of incorporation stating as the main objects of the organization the conduet of the business of marine insurance, the protee tinn of the interests of the members of the association, and the collection and publieation of information in regard to shipping. It is for of the last-named purpose that the has developed its remarkable system of agencies. whose intelligenee and dis patch in gathering and reporting shipping news are unequaled in any similar organization. Marine underwriting at Lloyds is still exeln sively an individual transaction. though under the general supervision of the association. The met his! of transacting business is as follows: A merehant having a ship to insure sends through a broker a slip setting forth the characteristics of the risk be desires insured. Any underwriter
who desires to assume it part of the risk places on the slip his initials and the 111111)11W he is willing to assume. No one underwriter assumes very large risks, a ship and cargo being usually underwritten by a large number of individuals, each of wl carries from £100 to L7100. The responsibility of each underwriter is limited to the amount for which he has subseribed. When the entire amount has been subseribed. the policy is made out and signed by NVII0 have already put their initials on the slip.
In the seventeenth century two insurance com panies. the loyal Exchange and the London. were authorized to transact n marine business. while the privilege was denied 10 all other companies. These Iwo companies appear to have done little marine In IS2.1 the monopoly re stiletitill was fe11111V(.11, and since that time many companies have gone into the business. Even these companies. however. find it advantageons to work Lloyds, melt of them having a representative on the floor of that association.
In it meripa marine insurance was the first form to be written. In 1759 the first oftiee was established. although a large amount of mugh vidual underwriting had previously been carried on. This /Alice was opened in New York. and was known as the Old Insurance Oilier. The method of conducting business was by individual underwriting, after the manner of the English Lloyds.
It was not until near the end of the eighteenth century that corporations took up the business of marine underwriting. The first in the rigid were the Insurance Company of North America and the lnsuranee Company of the State of Penn sy'lv'ania. Both were located in Philadelphia, and both began marine underwriting in 1794. The growth of the business was rapid and was greatly stimulated by the expansion of American shipping during the period of the Napoleonic wars in Europe. The companies rapidly ab sorbed the entire business of the country, and by the year 183.i individual underwriting Was prae tinily at an end in the United States.