The 300 dollar man
Here is a neat little nugget of historical incidence that illuminates the funda of insurance. I learnt about this while watching the movie Gangs of New York. You should watch it if nothing else than simply for Daniel Day Lewis who is a rocker!
This dates back to the time when US would conscript (also called "draft") citizens for its war purposes. Conscription is not your usual voluntary enlistment practised in India. Onto the nugget from Wikipedia.
A military manpower shortage occurred in the Union during the war. Congress passed the first conscription act in U.S. history on March 3, 1863, authorizing President Lincoln to draft citizens into military service who were between the ages of 18 and 35. Copperheads (Democrats opposed to the war) were dismayed by the news. Their main objection was to national service of any kind, but in terms of rhetoric, they attacked the provision allowing men drafted to pay either US$300 or supply a substitute as a "commutation fee" to procure exemption from service, which led to the derisive term "300 dollar man". However, in practice, men formed clubs whereby if one was drafted the others chipped in to pay the commutation fee.That is a fascinating historical example of mitigating risk through insurance!