Founding Policies

Every year on July 4th, Americans commemorate the signing of the Declaration of Independence and reflect on the values that shaped the nation’s foundation: resilience, innovation, and community. While fireworks and parades honor the political revolution of 1776, fewer recognize that one of the Founding Fathers also ignited another quiet revolution—this time, in insurance.

Benjamin Franklin, renowned polymath, inventor, and statesman, also played a foundational role in the development of the U.S. insurance industry. In 1752—a full 24 years before the Declaration of Independence was signed—Franklin co-founded the Philadelphia Contributionship, the nation’s first successful property insurance company.

The Philadelphia Contributionship was established as a mutual insurance company, meaning that policyholders were also the owners. Its goal was simple yet revolutionary: to protect buildings in Philadelphia from fire damage. At a time when fire posed one of the most significant threats to American cities, this form of organized risk pooling was a radical act of foresight.

What set the Contributionship apart was not only its founding structure but also its methods. The company introduced property inspections to assess risk, denied coverage to unsafe buildings (like those with wooden chimneys), and incentivized safer urban planning. These practices, which today we recognize as underwriting and risk management, were virtually unheard of in colonial America.

Franklin’s vision was not purely economic. Like many of his public ventures, the Contributionship was underpinned by a civic ethos. Franklin believed that insurance could strengthen community bonds, providing neighbors with the means to recover from catastrophe and reinvest in their shared prosperity. In a society still forming its identity, the idea of mutual responsibility was both practical and patriotic.

Moreover, the Contributionship reflected Enlightenment ideals of rationality and self-improvement. Just as democracy empowered individuals to shape their destiny, insurance empowered citizens to mitigate uncertainty through collective effort.

Fast forward more than 250 years, and the insurance industry is undergoing another transformation—this time powered by data, digital platforms, and artificial intelligence. Yet the philosophical roots remain familiar.

Like Franklin’s Contributionship, today’s InsurTech companies aim to democratize access, reduce risk through transparency, and improve efficiency by using smarter tools. Where Franklin used door-to-door surveys and empirical observation, modern startups use machine learning, remote sensing, and behavioral data.

• Mutuality is reborn in peer-to-peer insurance models
• Community safety is supported through IoT-powered home protection
• Fairness and transparency are delivered via ethical AI underwriting frameworks

These echoes are more than symbolic. They show that insurance, like democracy, is a living system that evolves with its people.

So this July 4th, while we honor the bold vision of America’s founders, let’s also take a moment to recognize that insurance is part of that founding story. Not in grand speeches or declarations, but in the quiet confidence that communities can thrive when risk is shared, not feared.

From fire buckets to APIs, the journey of insurance in America began with Franklin’s revolutionary insight: that security and self-governance go hand in hand. And that might just be a policy worth celebrating.

Check out The Philadelphia Contributorship’s full founding story here on their website