Markets and Insurance Company Investments, 1700–1900

Abstract

After 1700, financial markets in Britain developed rapidly in terms of borrowing and saving. Borrowing, underpinned by a stable financial system, was built around the Bank of England and a reliable government bond market, particularly after 1752 with the introduction of a risk-free asset. After the South Sea Bubble crisis, two insurance companies, the Royal Exchange and London Assurance, thrived. Life assurance subsequently developed rapidly with the Equitable, Scottish Widows, Standard Life and actuaries (William Morgan, A.H. Bailey) became increasingly influential. Insurance companies helped money and government bond markets to develop in the eighteenth century and securities markets (corporate debt and international securities) in the nineteenth. They funded developments such as the Bridgewater Canal, Regent Street (retail) and Belgravia (residential). Insurance companies were the first institutional investors.