ABSTRACT
Mutual and private insurance against the vicissitudes of life, health, and work existed long before the beginning of the welfare state. This chapter briefly sketches the mixed economy of welfare that existed before the welfare state and outlines some of the classic problems that plagued mutual, commercial, and social insurance. It then discusses patterns, problems, and processes of burial insurance, old age and widows’ pensions, unemployment insurance, and compensation for loss of income and the cost of medical treatment during sickness in the nineteenth century. Classic insurance problems, such as moral hazards and adverse selection, existed, but they could be overcome to a greater or lesser extent without the need for compulsory state arrangements. The chapter concludes by comparing these patterns, problems, and processes across the various types of insurance.
