Is Life Insurance Worth Getting?
Life Insurance — The Good, The Bad and The Ugly.
I don’t know about you, but no chat-up line I’ve ever been regaled with has included the words ‘life insurance’. The words conjure up an image of a middle-aged male, the pallor of his face briefly interrupted by a toothbrush moustache which vaguely matches his comb-over and dressed in brown from head to toe.
The very words ‘Life Insurance’ are somewhat of an oxymoron, aren’t they? Most of us think that life insurance is about our death, and who wants to think about that? The truth is, that while no one really accepts the notion of dying, it is the only certainty in life. Besides taxes, of course. But let’s leave that aside for the moment.
The first notion of life insurance dates back to when the Romans were conquering the world. They were called ‘benevolent societies’, and Gauis Marius, practical chap that he was, started the first burial club. Being a general in the Roman army, he was well into the ideology that an inadequate burial would produce an unhappy ghost. Understandably the general wanted to avoid that, so soldiers would pitch in and pay for the funerals of their dead comrades-in-arms. This concept continued to evolve to the point where the pooled funds would also provide a stipend for the next of kin of the deceased combatants. This primary form of life insurance continued for almost 5 centuries, until the fall of the Roman empire.
Some studies attribute similar origins to the Greek, but you get the gist.
Before that, the actual origin of insurance can be traced back to the third millennium BC, when Chinese traders realised the advantages of transferring risk — instead of having one ship carrying cargo, they’d break up the shipment to be transported by different vessels, thus minimising the possibility of loss.
The Babylonians went one further, a mere thousand years later. The Code of Hammurabi (Babylonian Code of Law of Mesopotamia, magnificently preserved to this day) decreed that if a loan was granted for the purchase of merchandise, the merchant would pay an extra sum to the lender so as to cancel the…