The History of Automobile Insurance
The history of automobile insurance in the United States of America basically started back in the late 1800s. During this time, the automobile was making headway into the industry for the future mass production of more vehicles. There was a necessity to have some type of payment plan when one motorist might be involved with another vehicle and rules to govern who would make the payment to the responsible party of the accident. It thus began the era of automobile insurance.
Though the automobile was a major breakthrough for transportation, it was also a mass of steel metal that could harm or damage objects and other vehicles. There needs to be some type of insurance to take place that would reimburse an automobile driver for the damage that occurred in an accident. There are those also that were stealing automobiles from owners and therefore, insurance was needed to compensate for the stolen vehicle. Insurance was a revolutionary new product that could be sold along with the purchase of an automobile, which was revolutionizing the motoring industry.
Driving an automobile back in early 1900s was a pure luxury for anybody that could afford one at the time. It was a privilege to be able to drive an automobile and have the responsibility to carry insurance, in order to protect all parties and the negligent drivers with liability coverage. The automobile insurance laws were different from state to state back in 1900s; most states did require mandatory car insurance once the vehicle was purchased.
There are those who bought automobiles in the beginning of the 1900s that were upset at having to purchase auto insurance as they felt it was a violation of their freedom from having to purchase automobile insurance. In fact, the automobile insurance in these days was based primarily by the tort law that had been implemented in the shipping days back in Christ’s times. Therefore, insurance has been around for several hundreds of years that were called the tort law.
The tort law dates back to 3000 BC and was used to compensate shippers from loss of cargo due to negligence or from ship loss at sea by the Chinese in this time. Therefore, insurance in history goes hand in hand as one of our greatest contributions to present day living. A tort is when a person intentionally destroys property from negligence and or hurts a group of people or a person on purpose.
Auto insurance is basically a means of protecting oneself from a financial loss due to an accident or liability caused by the negligence of another. In this manner insurance is a type of guarantee that you’ll be financially reimbursed and are represented by a third party in the interest of the owner of the insurance policy. Through history, insurance has benefited the marine industry and the automobile industry up to the point the present day. Back in the 1900s, deaths due to automobile accidents were extremely high. The need to have some type of compensation for individuals affected by the injury or accident was paramount.
The insurance industry dating back from thousands of years ago up to the present day is a magnificent part of our history. Whereas in the year 2011 we depend upon insurance to cover us in our motor vehicles just as the merchants did in China’s years, is simply amazing. The rules of the game for insurance actually have not changed. Compensation for liability claims is still the main reason insurance is so valuable to carry on a vehicle with you today.
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