1.01 Insurance arose for the purpose of restoring the victim of an uncertain and unpredictable event, as far as is possible, to his or her original position. Insurance is essential to risk allocation between commercial operations, and also operates to remove the fear of personal and financial ruin. Since its earliest days, insurance has gradually expanded to cover the increasing risks inherent in a modern society. The earliest insurances were first party, in particular marine and, in due course, life, with the insurance of buildings and goods coming later. The idea of insuring against third party liabilities came relatively late, but liability cover is now a crucial element in all forms of insurance activity.