Risk, religion, and reified camels: the past and the future of insurance in Iran

This paper is a contribution to the understanding of insurance and risk management as a culturally mediated form of social action. It examines how commercial insurance functions in the Iranian marketplace, focusing on insurance against liability in bodily harm. The quantum of damages (diya) currently used in Iran’s ‘Islamicized’ laws, including in insurance law, is rooted in the historical conventions of Bedouin Arabs, chief among which was the cultural use of camels as a benchmark for the valuation of human life. The imposition of this cultural rule on contemporary insurance contracts complicates risk management via probabilistic logic, because there are major fluctuations in camel valuations in the Iranian market today. The use of this benchmark also has significant socio-economic implications for the insured. But, at the same time, there is surprising synergy between ancient culture and modern business because the same traditions that established camels as the benchmark for diya also gave birth to one of the earliest forms of proto-insurance against liability and continue to give religious legitimacy to the insurance business. By examining the incorporation of the Islamic quantum of damages in insurance calculations, this paper contributes to the broader understanding of the cultural and moral underpinnings of insurance, and sheds light on how the tensions between the cultural and economic elements of risk management are managed.