Global spread of risk
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One of the premises of insurability is that risks can be spread as widely as possible. The broader risks are shared, the more cost effective it becomes to cover them.
The first insurer to open international agencies was the British company Phoenix Assurance (founded in 1782). Insurers from all over the world have since built a global presence. Up until World War I, cross-border trade and business was relatively easy as there were hardly any restrictions hindering the transfer of capital and goods. The war put an end to this way of doing business.
Still, especially for reinsurance, it was essential to keep the business on a global scale. Also many insurers managed to keep representative offices in world markets. Many of them would target their fellow countrymen in distant markets, but some achieved significant market shares with the respective local population.
The first insurer to open international agencies was the British company Phoenix Assurance (founded in 1782). Insurers from all over the world have since built a global presence. Up until World War I, cross-border trade and business was relatively easy as there were hardly any restrictions hindering the transfer of capital and goods. The war put an end to this way of doing business.
Still, especially for reinsurance, it was essential to keep the business on a global scale. Also many insurers managed to keep representative offices in world markets. Many of them would target their fellow countrymen in distant markets, but some achieved significant market shares with the respective local population.
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