How the Scottish traits of thrift and practicality gave birth to the insurance industry.

It’s no surprise that the insurance industry got its start in Scotland. If you’ve been there, or if you’re from there, you’ll know why. Scotland is a rugged place. The climate can be cold and rainy. And the coastline, hills and valleys are steep and forbidding.

Life insurance is the ultimate community financial service. It’s a way we can help each other prosper in a world where anything can happen at any time.

It’s not a stretch, then, to consider how the terrain and climate have helped shape the Scottish character. The landscape presented challenges, and Scots were forced to be very independent. They also learned the benefits of strong family values and sticking together to defend what little they had. The clan system developed to give them the protection they needed from both the harsh geography and potential invaders.
It was for all these reasons that the Scots learned the virtues of thrift, practicality and innovation. For the earliest Scots, waste and luxury were dangerous. They became parsimonious to ensure the continued survival of family and clan. The descriptive phrase “long pockets and short arms” was more than a joke. “Cheap,” it turns out, was another word for having everything to lose.

As time moved on, the Scots applied their culture and heritage to new ways of thinking. They combined their gift for thrift with the advance of mathematics and a new age of wider social responsibility. Scotland became the home of philosophers, reformers, mathematicians, engineers and innovators – all eager to meet the challenges of a new age. It was during this time that the Scots contribution to life insurance was born.

The Scots’ embrace of mathematics provided the necessary tools to apply modern financial thinking to problems. As they found out, math, money, and thrift make great bedfellows. And so eventually, the Scots’ community approach to solving life’s problems gave rise to the idea of pooling money for a common cause. These are the factors that contributed to the development of life insurance.

To the Scots, and millions of others around the world, life insurance is a responsible investment in the future. No family should be without it in an age of constant change. This is the wisdom of the Scots, and we can all benefit from it today.

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