That's exactly how it started! People would go to a major bookmaker like Lloyd's coffee shop and place a bet against themselves. So you would bet that your ship would sink or your house would burn down or that you would suffer a crop failure. Then if the bad thing happened you would win the bet.

Of course, if the odds are close the bet would be very expensive, so you'd have to do monthly financing. But what if the catastrophic event happens before the bet is fully paid?

Somebody had the genius idea to pool everybody's bet and run the odds.