I had already told you the history of Lloyd’s in an article dedicated to the passion of our profession. In that article, I told you about the origin of the insurance, namely bets between sailors in 1688 on the survival or not of ships and their crews at sea. Man-to-man bets on risks and their evaluation/quantification that were creating the first insurance market in what was then called Lloyd’s Coffee House.
I discovered this fascinating story in more detail at the event “Lloyd’s 2025 – The Future of the insurance” for which I was selected to represent the Swiss market. As I listened to it, I realized one thing: this story has (almost) not aged. It is still, hundreds of years later, the way we see our business. A business where it is still a question of a bet, a bet between suppliers (us) and insureds (you) on the rate of risk: a calculation on the probability that the insured event will occur or not.
In special risks, this is exactly what we do at PSPI: an analysis of the risk and a calculation of whether the event will occur. For example: what are the risks for a special asset like a yacht that it sinks, that it hits another boat and that it causes pollution damage, that it is attacked by pirates, etc… . Then, for each risk, what is the probability of it happening? This is the difference between a packaged product approach and a tailor-made approach. A fundamental difference.
This is what allows us to create communities of assets with an identical risk/probability ratio, and thus to obtain the best possible rates from insurance companies for our clients.
This Lloyd’s methodology – originally applied to the maritime sector – has been transposed to all so-called special risks. The name given to the first car insurance contract in 1904: “ship navigating on land”.
Beyond the story-telling, it is above all a story of methodology. Processes, which are ultimately an eternal restart, and which contain within them all the passion of a profession.
Credit image : 1798 by William Holland -Image by © Bettmann/CORBIS