Critical tidbit. The most famous insurance market, called Lloyd’s of London, began in a coffee house. Sure, underwriters frequented the establishment as a hub of updated information such as navigation charts and weather patterns that helped them underwrite boating risks more accurately, but I suspect it was the coffee that really made things go!
I came upon this fun fact while reading Peter Bernstein’s Against the Gods: The Remarkable Story of Risk (1998). He traces historical developments that helped people learn to calculate probability and gauge risk.
Though considerably drier than the dramatic cover illustration of a ship tossed at sea, the book can fascinate. From the arrival of the numeral zero in the West to early efforts to gain an edge at the gambling table, to quantifying risk for insurance, to exploring the foundations of modern capital management, there’s a lot packed in for anyone interested in the historical development of math and the financial markets.