Unit 8 the insurance market

I. Reading

а) stress the first syllable:

mutual, policy, contract, promise, premium, actual, equal, value, coverage, criminal, rider, damage, personal, virtually, injury;

b) stress the second syllable:

Insurance, insure, indemnity, collect, deductible, exceed, amount, coinsurance, require, variable, include, protection, available, umbrella, liability;

c) stress the third syllable:

compensation, aviation.

1. Read and translate the text:

Insurance and risks

Insurance technology is a means chosen for funding of losses, incurred by individuals and companies as a result of various adverse conditions. The character of risks reimbursed through the mechanism of insurance, way of action of this mechanism depend upon the needs and wishes of a given society. The need in funds for indemnification for damages also differs. In one society a risk is taken by the state, in another - by private companies. However, the risks of large damages which cannot be covered by private structures must by always ensured by the government through taxation or by other means. Examples of risks covered by the government include risk related to the use of nuclear power or risk of unemployment. Systems of organization of insurance also differ across various countries.

Thus, this type of financial-economic activity is extremely important for provision of endless economic life of a society. In addition, it helps individuals to deal with consequences of adverse events. Insurance companies are a kind of regulators of society's attitude to risks. Pre –back office

There are two major types of insurance companies. A stock in­surance company is owned by stockholders, just like any other investor-owned company. A mutual insurance company is owned by its policy-holders. These companies are more popular today as more firms join together to start new mutual companies. They do so because stock companies (which are investor-owned) cannot or will not sell policies at "reasonable" prices.

The factor that makes insurance an effective way to cover risk is the Law of large numbers. It states that if a large number of people or organizations are exposed to the same risk, a predictable number of losses will occur during a given period of time.

What are some key terms used by insurance companies? An insurance policy is a written contract between the insured and an insurance company that promises to pay all or part of a loss. A premium is the fee charged by the insurance company. The rule of indemnity says an insured person cannot collect more than the actual loss. A deductible clause says that the insurance company will pay only the part of a loss that exceeds the deductible amount. A coinsurance clause requires businesses to carry insurance equal to 80 % of a building's value.

Business carries a variety of insurance coverage including fire auto and truck, liability, health, life criminal loss, and worker's compensation.

Property insurance includes fire insurance and its rider, which covers wind, hail, smoke and other damage. It also includes an insurance (including bodily injury, property damage, collision a comprehensive coverage), marine and aviation insurance.

Liability insurance provides protection against losses resulting from personal injuries or damage to the property of others. A variety f liability policies are available, including an umbrella liability policy that covers virtually everything. Workers' compensation is a form liability insurance for on-the-job injuries.