LLOYD'S: YESTERDAY AND TO-DAY To CHAPTER I. EARLY DAYS. 'OWERING head and shoulders above the crowd of institutions that have helped to make this country great and win for her the maritime supremacy of the world stands the Corporation of Lloyd's. The name is familiar in our mouths as household words, but how few there are who know anything really definite of its origin, or of what goes on within its walls to-day! "Lloyd's?" says the average man; "that's the shipping office, isn't it?" He has some hazy notion that it has something to do with ships, but exactly in what way he does not know. He has read in his daily paper that "Lloyd's Agent reports so-and-so," and he has often heard the expression "Al at Lloyd's." Some have a vague idea that it has something to do with a bank, and many are also imbued with the impression that a certain popular weekly journal emanates and derives its name from the organisation which is the hub and centre of the marine insurance of the world. Yet the history of this time-honoured institution is closely bound up with the commercial history of this country; and, supposing that, owing to some unimaginable combination of circumstances, its doors were to be closed to-morrow, its collapse would be, perhaps, more widely felt than that of any other commercial institution in the world. But as great rivers often trace their sources to the smallest of streamlets, so this mighty institution sprang from the humble origin of a riverside coffee-house. Towards the close of the seventeenth century Tower Street was one of the principal thoroughfares in the City of London, and there it was that a man named Edward Lloyd, from whom the world-famous institution takes its name, established his Coffee-house. The precise date is unknown. Who the man was or where he came from we do not know. Even the date of his death and the place of his burial are but recent discoveries. His biography was never written, and the fragmentary knowledge that we have of him to-day has mostly been gleaned from advertisements that appeared in the London Gazette of his day. That his establishment was in existence in 1688 we know from the following quaint advertisement in No. 2429 of the London Gazette: "On the 10th instant a middle-sized Man, having black curled Hair, Pockholes in his Face, an old brown riding Coat, and a black Bever Hat, was suspected to have taken away five Watches." Here follows a description of them, and the advertisement concludes: Whoever gives Notice of them to Mr. Edward Lloyd at his Coffee-house in Tower Street, or to Mr. Edward Bransby in Darby, shall have a Guinea Reward." Tower Street was the main thoroughfare between Wapping and the centre of shipping activity on Thames-side and the City; and the immediate neighbourhood embraced, as it does now, the Custom House, Billingsgate, and Trinity House. Sailors landing at St. Katharine's, or "Galley Key," would naturally patronise the nearest place of entertainment, and in this way it is easy to see how Lloyd's first became identified with the shipping interest. The advertisements in the London Gazette of that time tend to show that Lloyd's clientèle was in those days largely composed of seafaring persons. Some of them are curious reading, as witness No. 2495, A.D. 1689: “Run away from Captain John Bradyl, a Tawny Moor, about twenty years of age, bow-Legged, with a light-colour'd Coat, a white Wastecoat, and a pair of Shammy Breeches. Whoever gives Notice of him at the aforesaid Captain's House on Rotherhithe Wall, or at Mr. Lloyd's Coffee-house in Tower Street, shall have 20s. Reward, and their Charges." Again, in March, 1690, No. 2643: "Run from on Ship-board a Negro named Will, aged about 22; he had a grey Suit, and speaks English well. Whoever secures him, and gives Notice to Mr. Lloyd at his Coffee-house in Tower Street, London, shall have a Guinea Reward." Whether the identification of Lloyd's Coffee-house with marine insurance had already by that time begun is uncertain, but it is probable. That this business was practised in the City is evident from a Law Dictionary by Thomas Blount, of the Inner Temple, published In the Savoy Printed by Tho. Newcomb for John Martin which explains that a 1670. "Policy of Assurance (assecuratio) Is a course taken by those who adventure wares or merchandise by Sea; whereby they, unwilling to hazard their whole adventure do give some other person a certain rate or proportion as 6, 8 or 10 in the hundred, or such like, to secure the safe arrival of the Ship, & so much wares at the place agreed on. So that, if the Ship & Wares miscarry the Assurers or Insurers make good to the Venturer so much as they undertook to secure; if the Ship arrive safely, he gaines that clear which the Venturer agrees to pay him. And for the more certain dealing between them in this case there is a Clerk or Officer ordained to set down in writing the effect of their agreement, called Policy, to prevent any difference that might afterwards happen between them. This terme is mentioned Anno 13 Eliz. ca. 12, and thereby allowed and established; And 14 Car. 2 ca. 23 and is now many times used to Insure men's lives in Offices, who have paid great sums of money for the purchase thereof, and are insured from that Adventure by a certain company of Merchants, or Citizens, for three or four per cent. subscribing or Under-writing the Agreement, Policy or Agreement, who do among them share the premium, or money given by the Party insured, and run the hazard of it; such Assurance or Policies being not seldom also used in other matters where loss or damage is feared." When marine insurance was first practised among men is a matter of debate. Undoubtedly it was the first of all methods of protection against loss, and in some form or another can be traced back to very early times. Plutarch records of Marcus Cato, who was born 234 and died 149 B.C., that he was a great money-lender and "used to loan money in the most disreputable of all ways, namely on ships, and his method was as follows: He required his borrowers to form a large company, and when there were fifty partners, and as many ships for his security he took one share in the company himself and was represented by Quintio, a freedman of his who accompanied his clients in all their ventures. In this way his security was not imperilled but only a small part of it, and his profits were large." This kind of business partakes more of the nature of bottomry, and would appear to have been a recognised practice in Cato's time. The Phoenicians who traded to the shores of Britain may have utilised the system, and the Rhodians before them. The latter certainly adopted the system of General Average, but that, again, is not marine insurance. In the year 533 A.D. the Emperor Justinian issued an edict limiting the legal rate of interest to 6 per cent. in all cases except that of "Foenus Nauticum "-i.e., bottomry--where the rate allowed was twelve. It is probable that marine insurance in anything like the form in which it is practised to-day-i.e., a contract whereby, in the language of Arnould, "one party, for a stipulated sum, undertakes to indemnify the other against loss arising from certain sea perils or sea risks to which his ship, merchandise, or other interest, may be exposed during a certain voyage or a certain period of time "-had its birth in Northern Italy about the end of the twelfth or beginning of the thirteenth century. Villani, a fourteenth century Florentine historian, speaks of marine insurance as having originated in Lombardy in 1182. It was certainly no novelty in his day, as it is mentioned in a Pisan ordinance of 1318, and the date ascribed is probably approximately correct. The Genoese were the principal merchants and navigators of those days, and spread over the whole of middle and western Europe. These commercial travellers would bring their ideas, as well as their wares, with them. In the fourteenth century Bruges was one of the principal seaports-if not the principal-of the north, and it is on record that: "On the demand of the inhabitants of Bruges, the Count of Flanders permitted in the year 1310, the establishment in this town of a Chamber of Assurance, by means of which the merchants could insure their goods exposed to the risks of the Sea, or elsewhere, in paying a stipulated Percentage." London was another of the great towns of the Hansa League, and many of the Lombards-as these merchants of northern Italy were called-had settled down there. The insurance idea had taken root on the Continent, and London doubtless quickly followed suit in adopting it. The "Lombardy men were fast becoming a power in the land, and a quarter in the City, from which Lombard Street takes its name, was allotted to them by the Lord Mayor at the King's command. Foreign trade and commerce under their direction rapidly grew, and by the expulsion of the Jews by Edward the First their position was greatly strengthened. The Jews had been the principal usurers in this, as in other countries, but the Lombards were past masters in the business of banking and money-lending. The wording of the policy no doubt closely followed that in use by the Lombards themselves in their own country. Certainly there is a very striking resemblance in the phraseology of the oldest English forms of which we have any record to that of the policy form prescribed by the Ordinance of Florence of 1523. Of legislation on the subject of marine insurance there was, however, none in England until 1601, when the first British Marine Insurance Act was passed. That insurance was |