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Supplementary materials

Pensions and other financial products

Exercise 1. Choose the correct alternative.


A pension is a 1 sum/ quantityof money paid regularly to a person who has reached a certain age or retired. It is usually paid until the 2 receiver's/ recipient'sdeath, although in some cases a 3 widow/ wifemay continue to receive payments after her husband's death.

State pensions

Pensions paid by the state. In many countries, these are contribution-based: people who have not paid 4 sufficient/ satisfactorycontributions during their 5 work lives/ working livesdo not receive the full amount.

Occupational pension schemes

Pension schemes for employees working in a particular industry or for a particular company. In some cases, these are administered by insurance companies who invest the 6 payments/ premiumsand use the profits from this to pay out the 7 benefits/ rewards. In other cases they are self-administered: the premiums are invested by the pension fund 8 trustees/ trusteds.

Personal pension schemes

Schemes provided by 9 pension givers/ pension providerssuch as insurance companies and banks. The premiums are invested in a 10 pension treasure/ pension fund, and on retirement the pensioner receives a 11 lump sum/ chunk sumto invest in an annuity (see below). Personal pension schemes are also known as 12 "private pensions" / "alternative pensions".

Financial products

Exercise 2. Match the financial product with the benefits.

1. annuity a. If you're too ill to work, you receive payments.
2.life insurance b. You pay a lump sum, and receive regular payments for the rest of your life.
3.life assurance c. You receive a lump sum on a certain date (or earlier if you die).
4.endowment assurance d. Your beneficiaries receive money if you die young.
5.endowment mortgage e. You borrow money to buy a house. Many years later, your endowment repays the loan.
6. private health insurance f. You borrow money. When you die, your house is sold to repay the loan.
7.sickness insurance g. Your beneficiaries receive money when you die.
8. equity release scheme h. Your private hospital bills are paid.

Exercise 3. Choose the best word to complete the sentence.

1. A person who gives you information about financial products is a __________.

a.financial adviser b.financial helper c.financial assistant

2. Some financial advisers only earn money by giving advice. Others earn ________ from selling financial products.

a.wages b.payments c.commission

3. An actuary is a person who __________ insurance risk and calculates premiums.

a.thinks about b.assesses c.decides

4. When an endowment __________, you receive a lump sum.

a.finishes b.ends c.matures

5. Prices go up every year. This is because of __________.

a.inflation b.expansion c.evolution

6. Some pension payments increase every year __________ inflation.

a.in time with b.in line with c.at the speed of

7. Pension payments which increase in line with inflation are __________.

a.index connected b.index linked c.index controlled

8. Many financial analysts predict a __________ caused by too many pensioners and not enough workers.

a.pensions crisis b.pensions disaster c.pensions emergency

9. A small additional pension is known as a __________.

a.topper pension b.topping pension c.top-up pension

10. Banks and insurance companies are types of __________.

a.financial institution b.finance company c.financier

11. Pension funds are usually administered by a __________ of trustees.

a.group b.bunch c.board

12. Pension funds, insurance companies and other financial institutions that invest on the stock market are known as __________.

a.commercial investors b.institutional investors c.company investors

13. Individual people who invest on the stock market are known as __________.

a.private investors b.personal investors c.one-man investors

14. In most countries, financial products and services are __________ by the government.

a.watched b.decided c.Regulated


Exercise 4. Match these types of insurance with the definitions.

1. Third party only a. Home insurance covering the fabric of the building only.
2. Third party fire and theft b. Pays out if you die or after a set period - whichever is later.
3.Fully comprehensive c. Home insurance covering most risks.
4. Buildings only d. Motor insurance. Will only pay claims made against you by others.
5. Buildings and contents e. Covers the costs of private health care.
6. Third party liability f. Motor insurance. Will pay claims made against you by others plus damage caused by fire.
7. Worldwide travel g. Motor insurance covering all risks.
8. Private health h. Covers claims made against you by others, for example if you run a business.
9. Indemnity insurance i. Insurance cover for problems while on holiday abroad.
10. Personal injury j. Any insurance which covers financial loss (numbers 1 to 8 are types of indemnity insurance).
11. Life k. Pays out in the event of a personal accident.


Exercise 5. Put the words into the correct spaces.

take out _ broker _ quote _ premium covered _ claim _ pay out _ fill in

How to ______________ an insurance policy:

1. Choose an insurance ______________, or contact an insurance company direct.

2. Phone up and get a ______________ (or you can do this on the internet).

3. Pay the ______________.

4. Now you're ______________.

5. If you need to make a ______________, contact the insurance company.

6. You will probably have to ______________ a claim form.

7. You may have to wait several weeks for the insurance company to ______________.


Exercise 6. Choose the best words to go into each space.

1. A person who assesses insurance claims is called a __________.

a.loss adjuster b.claim adjuster c.insurance adjuster

2. Your home insurance will be expensive if you live in a _________ area.

a.big risk b.risky c.high risk

3. An insurance broker usually __________ several different insurance companies

a.deals with b.contacts c.works for

4. In many cases, the insurance company doesn't take the financial __________.

a.problem b.risk c.damage

5. The financial risk is taken by _________ such as Lloyds of London.

a.underwriters b.undertakers c.underpasses

6. Natural disasters usually mean that insurance underwriters suffer __________.

a.heavy losses b.high expenses c.big debts

7. A __________ proves you have insurance while the policy is being processed.

a.cover letter b.cover paper c.cover note

8. If you agree to pay, for example, the first £200 of a claim, then your policy has a £200 __________.

a.surplus b.extra c.excess

9. A company giving insurance cover is known as the __________.

a.insurer b.insured c.insurance

10. A person who has taken out insurance cover is known as the __________…

a.insurer b.insured c.insurance

11. …or the __________.

a.policyholder b.policy-taker c.policy

12. A life insurance policy pays out __________ your death or after a set period, whichever is first.

a.in case of b.if c.in the event of

Exercise 7. Choose the correct prepositions.

1. I've never claimed on/ frommy insurance.

2. Don't worry. It's covered by/ withmy insurance.

3. I'm insured for/ bythe Lion Rock Insurance Company.

4. This sculpture is insured for/ at£100,000.

5. I'm insured to/ fordrive any car.

6. I'm covered by/ forall risks.

7. Which insurance company are you with/ in?

Exercise 8. This exercise defines the most important kinds of bank. Complete the text using these words:

Central bank Supranational banks Merchant banks Finance house
Commercial banks Building societies Universal banks Investment banks


____________ supervise the banking system; fix the minimum interest rate; issue bank notes; control the money supply; influence exchange rates; and act as lender of last resort.

_____________ are businesses that trade in money. They receive and hold deposits in current and savings accounts, pay money according to customers’ instructions, lend money, and offer investment advice, foreign exchange facilities, and so on. In some countries such as England these banks have branches in all major towns; in other countries these are smaller regional banks. Under American law, for example, banks can operate in only one state. Some countries have banks that were originally confined to a single industry, e.g. the Credit Agricole in France, but these now usually have a far wider customer base.

In some European countries, notably Germany, Austria, and Switzerland, there are ____________ which combine deposit and loan banking with share and dealing, investment advice, etc. Yet even universal banks usually form a subsidiary, known as a ________ , to lend money – at several per cent over the base lending rate – for hire purchase or instalment credit, that is, loans to consumers that are repaid in regular, equal monthly amounts.

In Britain, the USA and Japan, however, there is, or used to be, a strict separation between commercial banks and banks that do stockbroking or bond dealing. Thus in Britain, _________ specialize in raising funds for industry on the various financial markets, financing international trade, issuing and underwriting securities, dealing with takeovers and mergers, issuing government bonds, and so on. They also offer stockbroking and portfolio management services to rich corporate and individual clients. _________________ in the USA are similar, but they can only act as intermediaries offering advisory services, and do not offer loans themselves.

Yet despite the Glass-Steagall Act in the USA, and Article 65, imposed by Americans in Japan in 1945, which enforce this separation, the distinction between commercial and merchant or investment banks has become less clear in recentyears. Deregulation in the USA and Britain is leading to the creation of ‘financial supermarkets’ – conglomerates combining the services previously offered by stockbrokers, banks, insurance companies, etc.

In Britain there are also __________ that provide mortgages, i.e. they lend money to home-buyers on the security of houses and flats, and attract savers by paying higher interest than the banks. The savings and loan associations in the United States served a similar function, until most of them went spectacularly bankrupt at the end of the 1980s.

There are also ___________ such as the World Bank or the European Bank for Reconstruction and Development, which are generally concerned with economic development.

Exercise 9. All the words below can be combined with words ‘bank’ or ‘banking’ in a two-word partnership, e.g. bank holiday or off-shore banking. Add the word ‘bank’ or ‘banking’ before or after each of the words below.

1. ……. account ……. 10…….. merchant ……..
2. ……. balance ……. 11…….. note ……..
3. ……. central …….. 12…….. off-shore ……..
4. ……. clerk ……. 13…….. retail ………
5. ……. commercial ……. 14…….. robbery ………
6. ……. deposit ……. 15…….. savings ………
7. ……. holiday ……. 16…….. statement …….
8. ……. investment ……… 17…….. system ……..
9. ……. manager ……. 18…….. wholesale …….



Date: 2015-12-24; view: 1017

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