Insuring trade risks

1. Answer these questions:

a. What things do you and your family insure against?
b. What sort of things do big international companies need to ensure
against?

2. Read the article quickly and, in as few words as possible, say what the main
point of the article is.
3. Read the article again and answer these questions:
a. How did the insurance industry start?
b. What do reinsurers do?
c. How do the two examples of major losses in paragraphs 7 and 8
illustrate this quote?
“Countries with an underdeveloped system of insurance suffer
immeasurably more from major catastrophes than those where a good
part of the material losses can be covered by professional risk
carriers.”

4. In your own words, summarise the key points in the numbered examples (1-3)
in the article.

5. Find words in the article which mean the following.

a. when the maker of a product is responsible for any injury that product
causes (paragraph 4)
b. money that a court orders someone to pay to someone else (paragraph
5)
c. the collection of all policies held by an insurer (paragraph 6)
d. the total combined risks that could be involved in a single loss event
(paragraph 7)
e. a terrible event that causes a lot of destruction and suffering
(paragraph 9)

6. Complete the sentences with words from exercise 5.

a. They are being sued for __________ by clients who they advised to invest
in an insurance company that went bankrupt.
b. The defect in her car caused the accident, and she is suing the
company for product __________
c. The region was devastated by a natural ____________
d. It’s safer to spread your liability by holding a _________ of risks.
e. An ____________ of risk happens when there is a concentration of risks
that might give rise to very large losses from a single event.
7. Without looking back at the article, match the words on the left to the phrases
on the right to make expressions.

1.bear a.the way

2.spring b.the brunt

3.meet c.to mind

4.pave d.the risks

5.spread e.a need

8. Match the expressions in exercise 7 to their meanings:

a. immediately think of something
b. make it possible for something to happen in the future
c. suffer the worst part of something unpleasant
d. reduce the chance of a large loss by sharing risks
e. be good enough to do what someone needs, wants or expects.

9. In the next 30 years, which types of risks do you think will become
a. more significant?
b. less significant?