INSURANCE

A risk shared is a risk halved Putting aside sums of money to cover against financial problems

COMMON FUND The pooling of risk = a large number of people each pay a sum of money/premium The risk is spread/shared between many people If anyone suffers a loss, he/she will be compensated with money from the fund

People in insurance the insured – covered by insurance insurer – gives insurance cover agent – employed by one insurer (commission) broker – independent, works for a number of insurers underwriter – estimates the risks/premiums loss adjuster – independent person/company decides if claims are valid and how much to pay for compensation

Common insurance terms premium – monthly/yearly payment for a policy comprehensive – all-inclusive, complete protection

compensation (indemnity)– money for suffering damage, loss, injury proposal form – application by a person/company requesting insurance claim – request by a policyholder for compensation under the policy reinsurance – insuring of risk by one insurance company with another

Types of insurance General insurance Household insurance Motor insurance Comprehensive insurance Fire insurance Insurance against burglary Accident insurance Life assurance/insurance

Contract Insurance policy (contract of indemnity – except for life assurance, personal accident, sickness) the insured/the insurer Renewal notice Invites to renew the cover

Application process Proposal form – request to cover risk Premium – sum of money paid each year Policy – contract Insurance certificate – motor insurance Renewal notice

Claims process The insurer takes risks > The insured suffers a loss/damage > The insured submits a claim > A loss adjuster estimates the damage Compensation - money paid for loss

Coverage and Billing CLAIMS POOL OF PREMIUMS OVERHEADS INVESTMENTS INDUSTRY GOVERNMENT INDIVIDUALS PROFITS

http://www.youtube.com/watch?v=nXfGeMNnBsM Summarize health insurance

Fill in the gaps: Thousands of people pay ___________ to insurance companies, which use the money to pay ___________ to people who suffer loss or damage. A part of the money goes for ___________expenses. The rest of the pool of premiums can be _________in the form of lending to _________, __________, or __________ in order to earn _______. In this way insurance companies become large _____________ investors that place great sums of money in various ____________ .

Thousands of people pay premiums to insurance companies, which use the money to pay claims to people who suffer loss or damage. A part of the money goes for running expenses. The rest of the pool of premiums can be invested in the form of lending to industry, government, or individuals in order to earn profit. In this way insurance companies become large institutional investors that place great sums of money in various securities .

Pair the halves of the sentences below and write out the completed ones: It is important to keep the value of your policy Make sure you get insured When you say what you want your insurance to cover, If an accident does happen, If the company agrees to your claim, you make a claim to the insurance company. against accidents. you receive compensation. then the broker will tell you which policy you should take out. closely linked to the value of your property.

FILL IN THE WORDS: premium, beneficiary, claim, to cover, insurance policy, assured life, broker, the insurer, settlement, accident If you want to take out an ______________, you can either go to an insurance company or to a ________who will help you decide which company has the best policy for you. First you say what you want your insurance __________. The broker will tell you how much money or ___________ you will have to pay, so that you can get money back from ___________if an _________ happens. If an accident does happen, you make a __________ and if the company agrees to it, you receive money. This is the ___________ of your claim. In the case of a claim on an__________________, the _____________ – the person who gets the money when someone dies – is usually a member of the policyholder’s family.

If you want to take out an insurance policy, you can either go to an insurance company or to a broker who will help you decide which company has the best policy for you. First you say what you want your insurance to cover. The broker will tell you how much money or premium you will have to pay, so that you can get money back from the insurer if an accident happens. If an accident does happen, you make a claim and if the company agrees to it, you receive money. This is the settlement of your claim. In the case of a claim on an assured life, the beneficiary – the person who gets the money when someone dies – is usually a member of the policyholder’s family.

http://www.youtube.com/watch?v=nXfGeMNnBsM&feature=related How does insurance work? ____________________________________ _____________________________________ __________________________________________________

RB: pp. 65-68