Life Insurance

Germany's Risk Pioneer

Ernst-Wilhelm Arnoldi  was head and shoulders above the competition in Gotha. Source: imago
Ernst-Wilhelm Arnoldi was head and shoulders above the competition in Gotha.
  • Why it matters

    Why it matters

    One of German business’ seminal moments, the birth of life insurance, was brought about by a relentless entrepreneur and a feeble-minded aristocrat.

  • Facts


    Mr. Arnoldi used a trick when he started in the insurance business, so it looked like he had more clients.

    He set up his business in Gotha, Thuringia, founding the predecessor of present-day German insurer Gothaer.

    With a fondness for poetry, Mr. Arnoldi met his contemporary Johann Wolfgang von Goethe.

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On that fateful night, Ernst-Wilhelm Arnoldi sat again in his room racking his brains, as he had so often in the previous years. He felt it working within him, urging him on, he felt this feeling of built-up energy that only those people bursting with ideas know. He knew he must succeed in convincing people.

The idea that he carried with him was truly that irresistible: With industrialization in full swing and businesses becoming bigger and bigger, he wanted to insure the businesses, first for damages from fire, then from other risks.

Mr. Arnoldi knew that the small mutual societies that people had used for a few centuries to insure their activities from risk were no longer enough.

A broader basis was needed: if many people from the entire country regularly paid their premiums for such an insurance, then this could be enough to cover even major damages for industrial firms, which were also finding their way into his home state of Thuringia. Mr. Arnoldi had spent the previous weeks spreading the idea with the local businesses and bourgeoisie from Hof to his hometown of Gotha.

It soon became clear to him that people only trusted him if as many people as possible also trusted him. Only then did they have the certainty that the contributions paid to Mr. Arnoldi’s company would give it enough of a financial cushion to be able to pay in the event of damages. Therefore, there needed to be enough people at the beginning to take the first step.

It was December 31, 1820, and time was pressing.

Mr. Arnoldi, with sideburns, thinning hair, and a piercing gaze, had started his insurance business full of optimism half a year before, on July 2, 1820 in Gotha. He wrote in its charter: “The bank only comes into full effect as soon as the amount of the insurance policies reaches 4 million taler.” He had expected he would have collected a larger amount by January 1, 1821.

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