insurance revision and hw check. pair the halves of sentences: 1. it is important to keep the value...

24
Insurance Revision and hw check

Upload: maurice-arnold

Post on 12-Jan-2016

218 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

InsuranceRevision and hw check

Page 2: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Pair the halves of sentences:• 1. It is important to keep the value of your policy• 2. Make sure you get insured• 3. When you say what you want your insurance

to cover,• 4. If an accident does happen,• 5. If the company agrees to your claim,•

• a) you make a claim to the insurance company.• b) against accidents.• c) you receive compensation.• d) then the broker will tell you which policy you

could take out.• e) closely linked to the value of your property.

Page 3: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

• 1. It is important to keep the value of your policyclosely linked to the value of your property.

• 2. Make sure you get insured against accidents.

• 3. When you say what you want your insurance to cover, then the broker will tell you which policy you could take out.

• 4. If an accident does happen, you make a claim to the insurance company.

• 5. If the company agrees to your claim, you receive compensation.

Page 4: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Revision: fill in the missing prepositions• face risk / face a risk ____ fire• insure ______ risk / burglary / theft / injury• to be covered _______ loss• two parties ____ an insurance contract• receive money ____ premiums• pay money ____ compensation• penetration ___ insurance• worst year ___ record• big number ___ insurance terms• compared ____ $ 2000 ___ head• exclusions ____ “acts ___ God”• an analyst ___ Numis Securities / PBZ / CNB

ofagainst

againstto

inin

of on

in to per for of at

Page 5: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

HW: • RB, p 68 Read: Lloyd’s tsunami exposure limitedExplain the heading and following expressions: - unscathed- limited/minimal exposure

- penetration of insurance (marketing)

- insurance spent per head - exclusions for “acts of God”

- the worst on record in terms of...- property claims- reinsure- softening of (premium) rates

= not harmed or injured

= the amount of money company risks losing

= how much of a particular market insurance sales cover

= insurance claims for property that has been damaged

= falling because supply exceeds demand (→ a soft insurance market)

Page 6: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Comprehension check: True or false?In Indonesia & Thailand the penetration of insurance is high. T F

The average insurance per head in the US is 30 times greater than the average in Sri Lanka. T F

Lloyd’s will not lose a lot owing to the Asian tsunami. T F

Insurance losses come close to economic losses caused by the Asian tsunami. T F

The Asian tsunami of 2004 is likely to cost the global insurance industry less than one bad hurricane hitting Florida. T F

Worldwide claims in 2004 surpassed all insurance losses recorded in the preceeding years. T F

The insurance industry is still profitable as a result of soft premium rates. T F

F

F

T

F

T

T

F

Page 7: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

WHAT FITS HERE?

• domestic ~• stable ~• foreign ~• weak ~• hard ~• convertible ~• common ~• national ~

• (ex)change ~• convert ~ (to) • buy/sell ~• devalue/revalue ~• peg/fix ~ (to)• ~ rises/falls• ~ floats• ~ fluctuates

Page 8: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

one word fit all: CURRENCY (n.)

Adjective + currency• domestic ~• stable ~• foreign ~• weak ~• hard ~• convertible ~• common ~• national ~

Verb (vt*) + currency (object)

• (ex)change ~• convert ~ (to) • buy/sell ~• devalue/revalue ~• peg/fix ~ (to)currency + verb (vi**)• ~ rises/falls• ~ floats• ~ fluctuates*transitive – followed by a

direct object**intransitive – no dir. object

Page 9: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Handout

• Exercise 1

Page 10: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Currencies• the US dollar (USD / US$)• the euro (EUR / €)• the yen (JPY / ¥)• the British pound (GBP / ₤)• the kuna (HRK)the euro but 10.000 eurosThe dollar has slipped by around 3% against

the yen and the euro since November.______________________________________________________________________________________________________________________________________

Their house is now worth 250.000 euros.______________________________________________________________________________________________________________

For deposits in amount over USD 10.000,EUR 10.000 or PLN 50.000

Page 11: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Handout

• Exercise 2

• Exercise 3

Page 12: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Exchange rate is...(note: prepositions)

• the amount of one currency that can be bought with another– The exchange rate is 7.5 kunas to the euro.– The exchange rate is 5.7 kunas to the USD.

• the price at which one currency can be bought• a rate at which one currency can be exchanged

into / for another currency. • value one currency in terms of other

– € 1 = HRK 7.5– the conversion rate of every € to HRK

Page 13: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

• Why do companies, institutions and people buy currencies?

• How is the value (the exchange rate) of the money in your pocked determined?

• Has the value HRK increased or decreased in the past few months?

• Has it increased or decreased since the summer? Why?

• Is the exchange rate of HRK fixed?

• What do we call this type of exchange rate?

• FLOATING

• Is it freely floating?

• Which institution supervises the exchange rate?

Page 14: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Revise: Functions of the Central Bank

1) __________ monetary _________

2) commercial banks __________

3) exchange rate ______________

4) acting as a lender of ____ ________

implementing policy

supervision

supervision

last resort

Page 15: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Types of exchange rate• _______ exchange rate

• _______ exchange rate

Page 16: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Types of exchange rate• Fixed exchange rate

• Floating exchange rate– Freely floating / clean floating e.r.– Managed floating / ________ floating e.r.dirty

Page 17: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Which of the three rates are described below?FIXED EXCHANGE RATE,

MANAGED FLOATING E.R. or FREELY FLOATING E.R.1. a rate which is set by the govt. (central bank) only........2. a rate which is determined by the private market through

supply and demand ............3. its value will decrease only if demand is low (and vice-versa)

.................4. it does not change before it is centrally decided ...........5. if the rate changes more than the central bank allows, the

bank intervenes (buys or sells the currency) ......6. based on the free market only........7. its value will rise only if demand is high .................8. a combination of the other two types ............9. example of intervention in the economy ............

www.investopedia.com

fixed e.r.

freely floating e.r.

freely floating e.r.

fixed e.r.

managed floating e.r.freely floating e.r.

freely floating e.r.

managed floating e.r.

fixed; managed floating e.r.

Page 18: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Read EXCHANGE RATES, pg. 1 MK, U 26, p 128 and match with a heading

After reading, complete the following paragraphs

• The Bretton-Woods Agreement of 1944 established ______ exchange rates, defined in terms of ______ and the US dollar. Between 1944 and 1971 many currencies were _______ ______ the US dollar, i.e. their parities with the US dolar were fixed. One US dollar was a promissory note issued by the US Tresury and could be exchanged for 1/35th of an ________ of gold. Under this system, fixed exchange rates could only be adjusted (revalued or _________) with the agreement of the ____________ _____________ _____________.

Page 19: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

• The Bretton-Woods system of gold __________ and pegging ________ the dollar was abandoned in 1971, because following inflation, the Federal Reserve did not have enough gold to _________ its currency.

Say which: devalued or revalued• An overvalued currency had to be __________.• An undervalued currency had to be _________.• Currencies could only be adjusted with the

agreement of the ______.

Page 20: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Please, read pg. 2 & match with a heading

• Most western countries have had __________ exchange rates ever since 1971. This means that exchange rates are determined by the market ________ - the quantities _______ and ______. If demand exceeds supply, the price will ______; if supply exceeds demand, the price of a currency will _______. Milton Friedman, for example, was a __________ of freely floating exchange rates. He ________ that currencies would automatically settle at stable rates which would ______ underlying economic _________. However, proponents of freely floating exchange rates ____________ the impact of speculation.

Page 21: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Read pg. 3 & match with a heading

• PPP stands for _______ _______ ______. Purchasing power – the ability to buy thingsParity – the state of being the same or equalIf HRK and GBP have PPP, an amount of HRK needed to

buy particular goods in Croatia will buy ________ amount of goods in the United Kingdom when exchanged into GBP.

• If floating exchange rates gave PPP, the cost of a given selection of goods would be the same in different countries.

• Floating exchange rates do not give PPP because of currency ____________.

• As much as ____% of world’s currency transactions are purely speculative.

Page 22: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Please, read pgs. 4 & 5match with headings

Match to create collocations used in pgs. 4&5• intervene currency reserves• hedge contracts• raw planning • futures markets • forward of the Euro• export against currency fluctuations• establishment materials• foreign in exchange markets

Page 23: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Pg. 4 – Counteracting speculationPg. 5 – Market interventions

Match to create collocations used in pgs. 4&5• intervene in exchange markets• hedge against currency fluctuations• raw materials• futures contracts• forward planning• export markets • establishment of the Euro• foreign currency reservesHW: MK, p 1291) Comprehension (write questions) & Vocabulary2) Watch the following video on PPP http://opengecko.com/economics/purchasing-power-parity/ and answer the questions

(next slide)

Page 24: Insurance Revision and hw check. Pair the halves of sentences: 1. It is important to keep the value of your policy 2. Make sure you get insured 3. When

Watch and try to get answers to the following questions:

• PPP: http://opengecko.com/economics/purchasing-power-parity/

• What happens with the exchange rate in the very long run?

• What will countries do if they find that their goods and services have become very expensive?

• How will that affect the prices and exchange rates?

• What do we call this phenomenon?• What is the law of one price?