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"in the course of the seventeenth century, many wealthy entrepreneurs preferred speculative trade and investments in credits and insurances to the efforts and risks of foreign trade. ‘In short, finance was... a lazy man’s way to make money." Much discussion of price-fixing and excessive premiums for insurance brokered in Rotterdam. They got too greedy and lost business to London.

The author credits marine insurance with influencing the growth of trade, but missed a crucial point - insurance made possible long-distance trading in boring, low-margin commodities. The author barely mentions what was being shipped. The Dutch became known as "Herring-tamers". The Dutch also innovated in cost accounting, to make sure the low-risk low-margin operations were profitable. Covered on HN at [1].

Related: "Against the Gods, the remarkable story of risk" (1998, Bernstein).[2] That, too, is a history of marine insurance, but covers more of the Lloyds of London view. That book is clearer on the role of insurance in making boring businesses profitable. Early shipping was focused on high-value cargoes, and voyages were referred to as "ventures". This is where the term "venture capital" comes from, as does the phrase "waiting for their ship to come in". Investors put in money for a voyage as a risky investment. The thesis mentions that in the pre-insurance era, people were buying shares in ships, and one investor had shares in 78 different ships. Note the similarity to the YCombinator business model.

(Yes, I'm getting bored enough to write this.)

[1] https://news.ycombinator.com/item?id=18761704

[2] https://www.amazon.com/Against-Gods-Remarkable-Story-Risk/dp...

I came here to plug the same book. I read "Against the Gods" as part of an effort to understand business topics on a more fundamental level, and was not disappointed.

As a self-identified "tech guy", my eyes previously glazed over when someone mentioned financial topics like insurance. However, I came to understand insurance as deeply tied to human efforts to move civilization forward in a stochastic and uncertain world. Fantastic book.

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