Insurance Needs .
One of the earliest forms of insurance protected sailors from economic loss caused by pirates or storms. If one of the sailors was robbed by pirates or sustained damage due to weather, that sailor got the pool of money. Insurance works pretty much the same now, except a lot more time and effort is spent calculating the actual odds of loss and the actual premium required to cover losses, while still allowing the insurance company to make a profit. Now, insurance can cover a lot more forms of losses as well. I bet those sailers at Lloyd's would have never guessed that companies can now buy insurance in case their communication sattelites are damaged by meteors.