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Canada (510,273)
MTHEL 131 (111)
David Kohler (106)

Lecture 1.pdf

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Mathematics Electives
David Kohler

Lecture 1 Public petition for the first insurance company. 1757 London People’s desire to form a firm to reduce poverty. Protection of income in case of disease of breadwinner. Form life insurance companies for families to buy policies. 2013: motivation to buy life insurance hasn’t changed much (financially protect spouse/children) Three main concerns of Canadians 1. Living too long (depletion of savings): pension 2. Dying too soon (sudden loss of income): permanent life insurance 3. Illness, accident and disease (temporary loss of productivity): health insurance First life insurance policy 1583 London Richard Martin estimated the cost of the loss of his company’s manager ($383). (cost of death: train new person, business drop down, loyal customers turn to competitors) Friends in country club waged against the manager’s death (Richard Martin pays 8% upfront) (if the manager dies in 12 months, the country club guys pay 383.)(manager dies, Martin gets paid.) Insurer: country club guys Insured: Richard Martin (policy holder) Life insured: the manager (usu. Life insured = policy holder) Premium: 8% of 383 1583-1757 long time no development of insurance Reasons: 1. people were not clear between gambling and insurance, and superstition and fear. 2. Lack of knowledge on death rate (age increase, death rate increase), mortality tables/rates were not accurate (price of premium could not be set) 3. Epidemics/plague increased death rate, wiped out 2/3 European. 1757 death rate stabilized and petition to establish insurance company arouse but not enough votes. First
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