Auto Insurance In New Jersey

The Term Insurance Is Defined As An Agreement

The term insurance is defined as an agreement or policy between the insurer and the insured, where the insured pays the premiums and the insurer provides financial protection or reimbursement against losses. Many types of insurance plans are available worldwide and Auto insurance is one of its kinds. Auto insurance was developed to protect motorists and the third party from any bodily injury or property damage.

Car insurance concept was originated by the Chinese, dating back to 3000 B.C. in ancient China. They used to send their cargo ships full of supplies across the Atlantic Ocean. While going on for long and stormy voyages, there was always the risk of loosing ships due to sinking or hijacking by the pirates. To overcome these losses, the Chinese merchants used to segregate their consignments among several ships, thereby minimizing the total loss. Generally, a group of investors used to take the insurance policies on the ships to protect their valuables.

The earliest traces of insurance can be found in the ancient civilization of Babylon in the form of “bottomry”. Bottomry is a sort of mortgage where the ship owner used to borrow money by mortgaging the ship. And if, the ship is lost by the perils of the sea the borrower needn’t reimburse the money but if, the ship arrives safe he would have to repay the money lent, with the interest or premium. It was followed throughout the Mediterranean region and was implemented as mandatory by the Roman Emperor Justinian.