Abstract
Marine insurance is an old and very flexible financial instrument. Most of the fundamental characteristics of the policies underwritten today in international insurance markets were established in the fourteenth century, in the Italian city-states which then dominated extra-European trade. It was created by merchants as a tool to be employed amongst themselves, and was intended to spread the risks of ocean-going commerce as widely as possible between them, for the lowest possible cost. Unlike most credit instruments, which make advances of capital, marine insurance provides contingent capital which is paid to the buyer only in the event that an actual insured loss has occurred. This allows individual merchants to trade with less capital than the specific perils of individual adventures prudently demand, permitting them to maximise their investment in trade goods. As trade expanded and merchants’ trading patterns took them to increasingly distant ports, they brought their practices of marine insurance with them, transferring and expanding their system of risk-spreading at each new location.1
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Notes
For a comprehensive exploration of the Mediterranean origins and early spread of marine insurance, see Leonard, A.B. (ed.): Marine insurance: international development and evolution, Palgrave History of Finance Series, Basingstoke: Palgrave Macmillan, 2015.
For the identity of some very early Italian underwriters, see Leone, Alfonso: ‘Maritime insurance as a source for the history of international credit in the Middle Ages’, Journal of European Economic History, Vol. XII (1993), pp. 363–9.
Bensa, Enrico: Il contratto di assicurazione nel medio evo: studi e recerche, 1884. Translated to French as Valéry, Jules, (trans.), Histoire du contrat d’assurance au moyen age, Paris: Ancienne Librairie Thorin et Fis, 1897, p. 28;
Muldrew, Craig: ‘Atlantic World 1760–1820, economic impact’, in Canny, N. And Morgan, P. : The Oxford History of the Atlantic World, 1450–1850, Oxford: Oxford University Press, 2011.
For Ferrantyn’s nationality, see TNA SC 8/111/5523. For his insurance suit, see Thomas, A.H. (ed.): Calendar of plea & memoranda rolls of the City of London preserved among the archives of the Corporation of London at the Guildhall, AD 1413–1437, Cambridge: Cambridge University Press, 1943, pp. 208–10.
See also Lewin, C.G.: Pensions and insurance before 1800: A social history, East Linton: Tuckwell Press, 2003, pp. 85–8.
For a discussion of early insurance dispute resolution mechanisms in London, see Leonard, A.B.: The origins and development of London marine insurance, 1547–1824, unpublished PhD thesis, Faculty of History, University of Cambridge, 2013.
For the Law Merchant and codification in English marine insurance, see Rossi, Guido: ‘The Book of Orders of Assurances: a civil law code in 16th century London’, Maastricht Journal, Vol. 19, No. 2 (2012), pp. 240–61.
Nash, R.C.: ‘The organization of trade and finance in the British Atlantic economy, 1600–1830’, in Coclanis, Peter A.: The Atlantic economy during the seventeenth and eighteenth centuries: organisation, operation, practice and personnel. Columbia, SC: University of South Carolina Press, 2005, p. 133
For a full discussion of the impact of the efficacy of the Navigation Acts, see Zahedieh, Nuala: The capital and the colonies: London and the Atlantic economy 1660–1700, Cambridge: Cambridge University Press, 2010.
McCusker and Menard list among the invisibles freight charges, insurance premiums, and the costs of short-term credit. McCusker, J.J. and Menard, R.R.: The Economy of British America, 1607–1790, Chapel Hill: University of North Carolina Press, 1985, pp. 36, 91–2.
Michael Atkins to John Reynell, July 1751, cited in Pares, Richard: Yankees and Creoles: The trade between North America and the West Indies before the American Revolution, London: Longmans, Green & Co., 1956, p. 8
Richardson, David: ‘Slavery, trade, and economic growth in eighteenth-century New England’, in Solow, Barbara (ed.): Slavery and the rise of the Atlantic system, Cambridge: Cambridge University Press, 1991, p. 244.
Richardson, Slavery, trade, and economic growth, pp. 253–7; Shepherd, J.F. and Walton, G.M.: Shipping, maritime trade, and the economic development of colonial America, Cambridge: Cambridge University Press, 1972, p. 115.
A heavily edited selection of Claypoole’s letters has been published. Balderston, Marion (ed.): James Claypoole’s letter book, London and Philadelphia, 1681–1684, San Marino, CA: Huntington Library, 1967, p. 136 ff.
Morriss, Margaret Shove: ‘Colonial trade of Maryland, 1689–1715’, Johns Hopkins University studies in historical & political science, vol. XXXII, Baltimore: Johns Hopkins Press, 1914, pp. 446–599
Roseveare, Henry (ed.): Markets and merchants of the late seventeenth century: the Marescoe–David letters, 1668–1680, Oxford: Oxford University Press, 1987.
Crothers, A. Glenn: ‘Commercial risk and capital formation in early America: Virginia merchants and the rise of American marine insurance, 1750–1815’, Business History Review, vol. 78, no. 4 (Winter, 2004), p. 611.
Diary entry 1 Aug. 1768, Rowe Cunningham, Anne: Letters and diary of John Rowe, Boston merchant. Boston: W.B. Clarke, 1903, p. 171
Gillingham, Howard: Marine Insurance in Philadelphia, 1721–1800, Philadelphia: no publisher stated, 1933, pp. 42–63.
For a full account of the Browns, see Hedges, James: The Browns of Providence Plantations: colonial years, Cambridge, MA: Harvard University Press, 1952.
For a discussion of convoys and marine insurance, see Leonard, A.B.: Marine insurance and the rise of British merchant influence, 1649–1748, unpublished Master’s dissertation, University of Cambridge, 2011.
ECRO D/DRu B7, William Braund’s Journal of Risks, 1759–1765; TransAtlantic Slave Trade Database, www.slavevoyages.org. For the life and business interests of Braund, see Sutherland, Lucy: A London merchant, 1695–1744. London: Oxford University Press, 1933.
Testimony of Jones, Report from the Select Committee, p. 38; Commission on Money and Credit: Property and casualty insurance companies: their role as financial intermediaries, Englewood Cliffs: Prentice-Hall Inc., 1962, p. 13
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Leonard, A.B. (2015). From Local to Transatlantic: Insuring Trade in the Caribbean. In: Leonard, A.B., Pretel, D. (eds) The Caribbean and the Atlantic World Economy. Cambridge Imperial and Post-Colonial Studies Series. Palgrave Macmillan, London. https://doi.org/10.1057/9781137432728_7
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DOI: https://doi.org/10.1057/9781137432728_7
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