Unit 16: Insurance Intermediaries

1. Financial English Unit 16: Insurance Intermediaries

2. Unit 16: • Revision of Unit 15 • Background information of Unit 16 • Useful points of this unit • Text • Exercises • Assignment

3. Revision of Unit 15 • Review of Unit 15 • Dictation • Exercises

4. Dictation Dictation! You are going to hear 5 sentences. Each will be read three times. Write down the sentences according to what you hear. 1. 2. 3. 4. 5. Check-up

5. Dictation Key to Dictation: 1. Economic reforms led foreign enterprises to play a role in the revival of China's insurance industry beginning in 1992. 2. Although the annual developing rate was so high, China insurance industry was still a small part of the entire economy and at a low level. 3. China’s accession to WTO offered more opportunities than challenges. 4. To survive the difficulties, China's insurance industry should play its role of assurance and focus on guarantee instead of investment. 5. Insurance is becoming the most precious asset that a person can have invested in his own life.

6. Blanks filling Fill in the blanks with proper words or phrases given below thank prejudice suit have been rate quote calculation fill company international Paul smith( P) is inquiring the determination（决定） of the premium (保费)of Zhao Ming ( Z), an agent of PICC P&C. P: I know your insurance ________ is the biggest one in China and ____________ enjoying its high prestige worldwide throughout these years. Your insurance coverage must be very comprehensive. How do you fix the premium rate? Z: In principle, they vary with different cargoes, destinations, routes adopted and responsibilities in addition to the basis on statistic ____________ of the losses happened last year.

7. Blanks filling P: How is your ________compared with that of international market? Z: Our rates are in line with that in the world market. One of the references we take to fix our rates is the premium rate in the ________________ market. P: Under what situation will the rates be reduced? Z: Take all the factors into account, if your case _________ some of these factors, such as large quantity of goods to be shipped, short voyage, less extensive risk to be covered and so on, you may enjoy a little benefit from our lower rates. P: Now I have a deal just concluded with one of your firms here. Is there anything different if I take out the insurance（购买保险）with you? Z: Nothing different. We treat our customers on the same and equal terms, without any ___________ on foreign customers.

8. Blanks filling P: I’m glad to hear that. Then would you ________ your rates against All Risks for 500,000 metric tons of sugar at US$18,000 from Tianjin to San Diego? Z: Wait a minute. Totally the rates will be US$1080. P: What other formalities should I go through? Z: Here is the application form. ____________ them out, please. P: Would you please pass me a copy both Chinese and English? Z: Sorry, just a minute. Here you are. P: ____________ you very much. Check-up

9. Check-up P: I know your insurance company is the biggest one in China and has been enjoying its high prestige worldwide throughout these years. Your insurance coverage must be very comprehensive. How do you fix the premium rate? Z: In principle, they vary with different cargoes, destinations, routes adopted and responsibilities in addition to the basis on statistic calculation of the losses happened last year. P: How is your rate compared with that of international market? Z: Our rates are in line with that in the world market. One of the references we take to fix our rates is the premium rate in the international market.

10. Check-up P: Under what situation will the rates be reduced? Z: Take all the factors into account, if your case suits some of these factors, such as large quantity of goods to be shipped, short voyage, less extensive risk to be covered and so on, you may enjoy a little benefit from our lower rates. P: Now I have a deal just concluded with one of your firms here. Is there anything different if I take out the insurance （购买保险）with you? Z: Nothing different. We treat our customers on the same and equal terms, without any prejudice on foreign customers. P: I’m glad to hear that. Then would you quote your rates against All Risks for 500,000 metric tons of sugar at US$18,000 from Tianjin to San Diego?

11. Check-up Z: Wait a minute. Totally the rates will be US$1080. P: What other formalities should I go through? Z: Here is the application form. Fill them out, please. P: Would you please pass me a copy both Chinese and English? Z: Sorry, just a minute. Here you are. P: Thank you very much.

12. Text : Background Information 本章旨在介绍保险中介的概念，诠释保险中介存在的必要性，宣传保险中介的功能，分析保险中介的收入构成，并研究中国保险中介市场。在保险商品的销售中，购买保险者（即投保人）大多缺乏对保险制度、保险商品的理解和选择保险商品的经验，所以在购买保险商品时，熟悉保险商品的补助者的存在是必不可少的。保险中介正是在保险人和投保人间起着桥梁作用的补助者。

13. Text : Useful points of this unit 本章重点: 通过本章学习，学生应该掌握 1、保险中介的功能 2、保险中介的收入

14. Unit 16: • 16.1 Introduction to Insurance Intermediaries • 16.2 The Income of Insurance Intermediaries • 16.3 Functions of Insurance Intermediaries • MATCHMAKER • INSURANCE PLACEMENT • RISK MANAGEMENT 16.4 China’s Insurance intermediaries

15. Listening Text 16.1 Introduction to Insurance Intermediaries Listen carefully to the first part of the text and then try to translate some sentences.

16. Text : Sentence Translation An insurance intermediary is an individual or firm that provides advice on insurance and can arrange policies. Insurance intermediary is an indispensable entity of insurance market, which includes: insurance brokers, insurance agencies and insurance assessment institutions. While some of these establishments are directly affiliated with a particular insurer and only sell that carrier’s policies, many are independent and are thus free to market the policies of a variety of insurance carriers. Our focus is primarily on independent intermediaries, i.e., brokers and independent agents. End of part 1

17. Text : Key toTranslation 保险中介是可以为投保人提供保险建议并建立保险合同的个体或公司。保险中介是保险市场不可或缺的构成成分之一，包括保险代理人/公司、保险经纪人/公司、保险公估机构。 indispensable adj. not to be dispensed with; essential 不可缺少的；绝对必要的 entity n. something that exists as a particular and discrete unit 实体,实际并独立存在的事物 insurance brokers保险代理人 insurance agency保险代理公司 insurance assessment institutions保险公估机构

18. Text : Language Points be affiliated with 与…相关联的，附属于的 One of our affiliated companies is located in Hong Kong. 我们有家关系企业位于香港。 He is affiliated with good fellows. 他与好人交朋友。 They affiliated themselves with the organization. 他们加入了这个组织。 This hospital is affiliated with that university. 这个医院是那所大学的附属医院。

19. Listening Text 16.2 The Income of Insurance Intermediaries Listen carefully to the second part of the text and then try to understand it.

20. Text : Broker and agent compensationcomprises premium-based commissions, expressed as a percentage of the premium paid for each policy, and contingent commissions, also usually expressed as a percentage of premiums, based on factors such as the profitability, persistency, and/or volume of the business placed with the insurer. Larger intermediaries also receive fees for particular services such as risk management, captive management, risk modeling, and claims settlement services. Sometimes brokers will negotiate fees in lieu of ordinary commissions.

21. Text : Premium-based commissions account typically for about 10-11% of premiums, compared with an average of 1-2% of premiums for contingent commissions. Premium-based commissions constitute the vast majority of intermediary revenues, and contingent commissions account for about 4-5% of brokers’ revenues. Intermediaries also receive some non-cash compensation from insurers such as travel and vacation awards in recognition of superior performance. It is noticed that most of the contingent commissions are passed on to policyholders in the premium. However, whether this harms or benefits policyholders is a matter of debate. End of part 2

22. Text : Language Points compensation n. something (such as money) given or received as payment or reparation (as for a service or loss or injury)补偿,赔偿金,薪资 It's better for us to do total compensation trade. 对我们来说最好用全额补偿。 comprisevt. to consist of; be composed of 由…构成；由…组成 Twenty chapters comprise Book One. 第一卷有二十章。 The committee comprises five persons. 该委员会由五人组成。

23. Text : Language Points contingent adj. liable to occur but not with certainty; possible. 可能的：可能但又有不确定性的；可能的 Such risks are contingent to the trade. 这种风险在经商中是可能发生的。 They had to plan for contingent expenses. 他们不得不为可能的花费作计划。 profitability n. the quality of affording gain or benefit or profit 盈利能力, 获利能力 The managing director is interested only in increasing profitability. 总经理仅对提高利润率感兴趣。

24. Text : Language Points persistency n. persistent determination 持续 I was nettled by her persistency. 我被她的固执惹恼了。 Provided the dunce have persistency and application, he will inevitably head the clever fellow without those quality. 持之以恒、专业致志的笨人必然胜过有始无终、三心二意的智者。 in lieu of 代替 Childrem watched TV in lieu of doing their home work. 孩子们观看了电视代替做他们的作业。

25. Text : Language Points in recognition of 为酬答...而;按照(功劳等)... Deified mortals are revered in recognition of their feats. 有些本属凡人的神明，因曾立下大功而受人崇拜。 act or give something in recognition of someone's behavior. 为酬答某人的行为而奖给他东西。 Natural spectral peaks of the vocal tract that aid in the recognition of speech sounds. 声道的自然频谱峰值，帮助语音识别。

26. Listening Text 16.3 Functions of Insurance Intermediaries Listen carefully to the third part of the text and then try to translate some sentences.

27. Text : In most of the insurance markets, the intermediary plays the role of “market maker,” helping buyers to match with appropriate insurers, to identify their coverage before placing insurance and to guide them to manage risks. Insurance is a complex product representing a promise to compensate the insured or a third party according to specified terms and conditions should some well-defined contingent event occur. It requires complex language to simply describe the obligation of insurance.

28. Text : However, the buyer’s decision is made even more difficult because the value of the insurer’s promise depends both on the reputation of the insurance company for paying losses quickly and without fuss over the financial capability of the insurer to meet these obligations. Thus, the buyer of insurance faces the daunting task of first deciding what sort of insurance protection is needed for the risks given, and then comparing policies offering alternative coverage at different prices from several insurers with different levels of credit risk and varying reputations for claims settlement and policyholder services. Sentence Translation

29. Text : In most insurance transactions, there is an intermediary, usually an insurance agent or broker, between the buyer and the insurer. Brokers are traditionally described as agents of the policyholder and insurance agents as agents of insurers; this separation is more a matter of emphasis than a watertight division. Both agents and brokers often perform services such as record keeping and modeling for insurers, provide advice to clients on selecting insurers, and assist with claims settlement. Agents and brokers also play a key role in providing underwriting information to insurers. End of part 3

30. Text : Key toTranslation 但是，保险公司的承诺到底价值几何不仅取决于保险公司在快速赔付方面的声誉还与其偿还债务的财力相关，这使得保险购买者很难下决定。想要买保险就要面临任务量超大的工作：首先要选定保险的种类而后要拿多家保险公司的保险单对比保费价格，承保范围，赔付能力以及售后服务。

31. Text : Language Points fuss over 过分关心, 大惊小怪 Don't make so much fuss over the children. 不要对孩子照顾得太过分. I don't want to make a fuss over such a trifle. 我不想为这种小事大惊小怪。 daunting adj. making someone feel nervous and less confident about doing something 令人畏惧的，可怕的 The new job was a bit daunting at first but it was all right once I'd got my eye in. 一开始，那个新工作有点使人灰心丧气，但是一旦我获得了需要的能力，也就没什么了。

32. Text : Language Points watertight adj. impossible to fault, refute, or evade 不可能错误、反驳或回避的 A watertight alibi; a watertight contract. 无懈可击的借口；严密的合同 The ship's hold is built in watertight compartments. 船舱建造成许多不漏水的隔间。

33. Listening Text • 16.3 Functions of Insurance Intermediaries • MATCHMAKER Listen carefully to the fourth part of the text and then try to understand it.

34. Text : All insurance intermediaries, agents and brokers, are essentially matchmakers who match the insurance needs of policyholders with insurers who have the capability of meeting those needs. The matchmaking or “market making” role through which buyers are matched with insurers is a complex, multidimensional process. The role of the intermediary is to scan the market, match buyers with insurers who have the skill, capacity, risk appetite, and financial strength to underwrite the risk, and then help their client select from competing offers.Price is important but is only one of several criteria that buyers consider in deciding upon the insurer or insurers that provide their coverage. Also important are the breadth of coverage offered by competing insurers, the risk management services provided, the insurer’s reputation for claims settlement and financial strength, and other factors. End of part 4

35. Text : Language Points multidimensional adj. of, relating to, or having several dimensions 多维的 multidimensional problems多方面的问题 a multidimensional proposition多方面的主张 a multidimensional personality多维人格 criterian. the plural form of criterion, meaning standard, rule, or test on which a judgment or decision can be based.一种基以做出判断或决定的标准、准则或测试

36. Listening Text • 16.3 Functions of Insurance Intermediaries • INSURANCE PLACEMENT Listen carefully to the fifth part of the text and then try to understand it.

37. Text : Insurance intermediaries will go through the competitive market in search of the best placement for their client. It is common for the coverage not to be placed with the low bidder. In the case of very large risks, coverage is likely to be syndicated over many insurers, requiring considerable skill on the part of the intermediary. The integrity of the placement process recently has been questioned as a result of allegations of bid rigging in which one or more mega-brokers and a few insurers appear to have conspired to feign competition by submitting non-competitive bids. Clearly the integrity of the bidding process is vitally important to the health of the market.

38. Text : However, it is important to distinguish the natural variation in bidding practice that emerges in a normal market from illegal activities. For their part, insurers are invited to provide quotations on complex risks. Given the variation among insurers in their available capacity, their market niches, the distribution of risk in their portfolios, the information they have about the risk and their relationship with the intermediary who is placing the business, quotations will vary with some insurers possibly declining to quote. End of part 5

39. Text : Language Points syndicatevt. to organize into or manage as an association of people or firms authorized to undertake a duty or transact specific business. 把…组成辛迪加(授权承担某项责任或进行特定的商业交易的人们或公司的联合体) allegationn. a statement asserting something without proof 断言,主观臆测 The lawyer's allegation was proved. 律师的辩解已被证明属实。 The minister issued a prompt denial of the allegation against him. 部长迅速否认对他的不利断言。 bid rigging操纵投标;串通投标(投标方共谋确定中标价格或条件，以及投标双方商定一方不参与投标，或条件差的投标方故意出高价，或轮流抬价，使所有竞标方价格提高。)

40. Text : Language Points mega- prefix, meaning large 前缀“大的” mega homework许多家庭作业 These inspiring structures can tantalize and evoke emotions not normally associated with mega structures. 与其它大型建筑不同的是，这些令人震撼的设施常让人热血沸腾。 conspire vt. to plan or plot secretly 阴谋策划 People always conspire to keep the truth from me. 人们总是串通一气不把实情告诉我。 He was charged with conspiring against the government. 他被指控密谋推翻政府。

41. Text : Language Points feign vt. pretend to 假装 Some animal feign death when in danger. 有些动物遇危险时便装死。 The writer feigns many a myth. 作者想象出许多神话。 submit vt. To offer 提交，递交 submit a plan 提出一项计划 submit a case to the court向法院提出诉讼 Submit a dispute to law.将争端诉诸法律

42. Text : Language Points integrity n. steadfast adherence to a strict moral or ethical code 廉正，诚实 All respected him for his integrity. 他为人正直，大家都尊敬他。 I'm rather doubtful about his integrity. 我对这事的忠诚颇有怀疑。 vitally adv. extremely, in an essential way 极其，绝对 It is vitally important to cancel the order immediately. 最重要的是要立即取消这一定单. The way we choose to bring up children is vitally important. 抚养子女选用何种方式是极其重要的。

43. Text : Language Points variation n. The extent or degree to which something varies 变化范围或变化程度 the variation of opinion 意见的改变 The prices for food are subject to variation. 食品的价格可能变更。 niche n. a special area of demand for a product or service 产品或服务所需的特殊领域,定位 He found the right niche for himself. 他发现了一个适合他的职位。

44. Text : Language Points portfolio n. a group of investments 一组投资 My stockbroker manages my portfolio for me. 我的证券经纪人替我管理投资组合. decline 谢绝，拒绝 decline an offer 拒绝请求 decline to answer a question 拒绝回答问题 Do not decline an invitation to dinner. 不要谢绝吃饭的邀请。

45. Listening Text • 16.3 Functions of Insurance Intermediaries • RISK MANAGEMENT Listen carefully to the sixth part of the text and then try to translate some sentences.

46. Text : Sentence Translation In addition to placement of insurance, insurance intermediaries also help their clients understand and measure their risk, while giving them advice on how insurance can alleviate the costs of risk, help design insurance coverage programs, and assist with claims settlement. Intermediaries often provide other functions such as risk modeling, risk management consulting, management of captive insurance companies, asset management, etc. These latter services are more likely to be provided by the larger brokerage firms.

47. Text : Intermediaries play a vital role in soliciting quotations for complex risks and in helping clients make comparisons on the basis of price, coverage, service and the financial strength of the insurer. For their part, insurers often quote prices on the basis of information from its own risk analysis or provided by intermediaries. These quotations are often competitive if the insurer believes it has good information about the level of risk. However, insurers will often offer non-competitive bids, or decline to quote, if information is incomplete (the “winner’s curse”).

48. Text : This means that price quotations may vary considerably in their competitiveness. The role of the intermediary is to increase price and quality competitiveness, by providing the insured access to a wider range of possible insurers. However, contingent commissions, particularly those based on profit, may further stimulate competitive bidding. By aligning its interest with that of the intermediary, the insurer will have more confidence in the selection of risks and in the information provided by the intermediary. This will help break the “winner’s curse” and encourage insurers to bid more aggressively. End of part 6

49. Key to Translation : 保险中介不仅建立保险关系还可以帮助客户了解和评估他们所承担的风险，帮助他们分析如何利用保险降低其风险损失，确定合理的保险范围，并且帮助客户获得合理赔偿。保险中介可以提供的其它功能还有风险模型确定、风险管理咨询、资产管理以及承保公司的管理等。首先，我国是一个自然灾害多发的国家。地震、台风、洪水等多种自然灾害频频造访，日均损失高达17，000，000美金。

50. Text : Language Points alleviate vt. to make (pain, for example) more bearable减轻,使（痛苦等）更易于忍受 Alleviate burdens on sb. 减负 The doctor gave her an injection to alleviate the pain. 医生给她注射以减轻疼痛. We want to help alleviate the national food shortage. 我们想帮助缓解国家粮食短缺的状况。