B's Buzz

Against the Gods is a story of stories.  The book describes the evolution of risk management and the large influence this has had on human behaviors including the willingness for both businesses and individuals to take and manage high-risk endeavors. 

Insurance began as a form of gambling since there was little theoretical foundation for assessing risk.  As Peter describes in his linked website, “this book tells the story of a group of thinkers whose remarkable vision revealed how to put the future at the service of the present. By showing the world how to [define and] understand risk, measure it, and weigh its consequences, they converted risk-taking into one of the prime catalysts that drives modern Western society [and every day behaviors]."

Insurance frees up people and organizations to behave differently.  As a definition-form, insurance appears in more than ten stories among our lineup of two hundred and fifteen.  These include pirate disability awards, the role of insurance in healthcare delivery in France, Germany and Japan, and how a physical restraint to car theft, LoJack can reduce property and casualty insurance rates. 

A behavioral definition can be a two-sided coin.  Insurance on a large-scale can lead to an abusive misuse of society’s pooled funds.  We mention this because a (seemingly insurmountable) service delivery problem exists in both U.S. education and healthcare.  In either, a great deal can be learned and insights gained by deciding to follow the definitions.  We therefore recommend Bernstein's classic book as a companion read with Niall Ferguson’s Ascent of Money.