ABSTRACT
The word insurance (formerly called assurance) is of Italian origin, and the word policy derives from ‘polizza’, as promise or undertaking.1 The Lombards were the Italian immigrants who came to England in the thirteenth century to escape from war in the cities of Northern and Central Italy.2
The Lombards were the rich who left their homes, carrying all their valuables with them.3 With the money and the leadership they brought, the Lombards engaged in trade, money lending and building ships. They became involved in marine insurance in the fifteenth century, lending money to shipowners in the form of bottomry and respondentia. Bottomry is the transaction under which a shipowner borrowed money to carry out a seafaring venture by pledging his vessel as security for the loan.4 The shipowner was obliged to repay the loan only if the vessel arrived safely. If the vessel was lost, the shipowner was relieved of this obligation.5 The agreement was a ‘bottomry bond’ and the word ‘respondentia’ was used for a similar arrangement under which cargo was given as security.6
