Tontine History
About Tontine History
A tontine is a financial instrument where participants contribute to a pool, and as members die, the survivors receive increasing payments until the last survivor receives everything. Tontines were invented by Lorenzo de Tonti in 1653 and were used by European governments to raise funds. The English government established tontines to finance wars. The incentive to outlive other participants led to allegations of murder, depicted in literature and film. Tontines were banned in most countries by the early 20th century. The life insurance and annuity industries grew from tontine principles. Modern proposals for tontine style retirement products have emerged as a solution to longevity risk in aging populations.
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