1.

Definition

As we already know the recent events such as the pandemic and economic fallout,
threats to people and their own property tend to occur more on a daily basis. It
means that these unsafe situations have resulted in the appearance of insurance in
overcoming obstacles and protecting against financial struggles. So insurance is
considered as the important thing to protect and support humans through policies
appropriate to the individual’s current situation.

Why do we need insurance in this day and age?

Now, we will go into the first part of today’s presentation: Definition

Firstly, Insurance is a contract, represented by a policy, in which an individual

or entity receives financial protection or reimbursement against losses from an
insurance company. The company pools clients’ risks to make payments more
affordable for the insured.

It means that insurance is a contract where an individual or entity receives financial

protection against losses from an insurance company.

Personal insurance refers to any kind of insurance that covers individuals against
loss that results from death, injury, illness or loss of property. These insurance
lines generally protect people and their families from losses they couldn’t afford to
cover on their own

For example: In our class, is anyone using health insurance?

Health insurance, where an individual pays a premium to an insurance company in

exchange for coverage of medical expenses.

Auto insurance, where a car owner pays a premium to an insurance company in

exchange for coverage of damages to their car or liability for damages caused by
their car.

To sum up, insurance is a method in which an individual or entity receives financial

protection against losses or damages from different sources.

Let’s talk about risk. Imagine that you participate in insurance, there will be many
cases. If we buy good insurance, we won’t take on any risk. But on the contrary, we
will be impacted by losses and damages. Risk is the probability that actual
results will differ from expected results. In insurance, insurable risks are those
risks that insurance companies will cover. Some common examples include health
issues, danger to life, fire, perils of the sea. And these losses or damages we will
call risk.
2. Types of personal insurance
a. Health insurance
(?) When do you need health insurance?

-> get sick -> health insurance

- Health insurance is an insurance product which covers medical and
surgical expenses of an insured individual. It reimburses the expenses
incurred due to illness or injury or pays the care provider of the
insured individual directly
- Benefits:
+ Helps Deal with Rising Medical Costs: With a medical
insurance plan, you enjoy cover for everything from
ambulance charges to daycare procedures
+ Critical Illness Cover :You will be provided with a lump sum
payout in case you are diagnosed with any of the covered
critical illnesses which are often very expensive
+ Easy Cashless Claims: Every health insurance provider will
tie-up with a number of network hospitals where you can enjoy
cashless claims.
+ Added Protection: Individual health insurance plans offer
providers more and better cover than group plans.
+ Tax Savings:
+ There are two ways by which which the insurance company
compensate for your medical expenses:
 + Cashless Treatment: Here, the policyholder is not supposed to
pay anything to the network hospital. As the insurance
company pays the hospital directly.
+ Reimbursement: Here, the policyholder is supposed to settle
their medical expenses first and later ask for reimbursement
from the insurance company.
- Let's take a look at how health insurance actually works.
The process starts when you apply to purchase a plan. Depending
on your age, medical background, and the type of plan you've
selected, you will be provided with premium quotes. In some cases,
you might be asked to do a few medical tests before the insurance
provider decides whether they'd like to provide you with the required
cover. Once the terms and conditions are finalized, you will be
provided with a policy. Each policy comes with a few waiting
periods. During this time, you will not be able to make any non-
emergency claims. If you're able to get the treatment in a network
hospital, you can let them know about the surgery, and they'll get
in touch with the hospital directly to settle all the payments. If
you're getting treatment in a non-network hospital, you can make
all the payments and then file for a reimbursement claim

- Example:
For example, most of us Vietnamese have health insurance, so when we
are sick or want a general health check, we can use the terms of that
health insurance to get support. about medication and medical expenses.
b. Personal Possessions Insurance
 -> sth special is broken or lost: jewelry, laptop, camera…-> p.p.i
- Personal possessions insurance is also known as personal
belongings or personal item insurance and covers your everyday
belongings that you take with you and against theft, damage, loss in
and out of the home.
The amount of cover you require depends on what you need to
protect.
- What it covers:
It covers any item that belongs to you that you might use or carry in
or out of your home. The most commonly covered items under personal
possessions insurance are:

Mobile phones
Tablets and laptops
Still and/or video cameras and equipment
Keys
Jewellery
Purses, handbags, and wallets
Sporting and/or musical equipment

(?) Are these items the only things you can insure?
But these aren’t the only things you can insure. Anything that has value can be
covered, provided you or your family own it or are legally responsible for it.
- It’s also important to know what personal possessions insurance
doesn’t cover. Here are some exclusions:
+ > Motor vehicles and children’s motor vehicles whether
licensed for road use or not
+ Boats or any mechanically propelled or assisted watercraft
+ Pets and livestock
 + Money or credit cards
+ Household goods and domestic appliances
+ If your home has been left unoccupied for 60 days or more

=> This type of coverage helps pay to repair or replace your belongings after a
covered loss, such as theft or fire.

c. Motor insurance:

-> accident)

- Motor insurance is a unique, mandatory insurance policy meant

for vehicle owners to protect them from incurring any financial
losses and provide coverage for the cost of damage that may arise
due to damage or theft of the vehicle

(?) Why do people choose to use motor insurance?

-> Having motor insurance protects your savings in case of damage

caused to your vehicle because the insurance company covers the
losses.

- You will come across three different types of insurance policies in

the market that provides coverage for motor vehicles:

● Third-party insurance policy: The chief objective of this policy is

to provide coverage for any injury caused to a third party by your vehicle.
Therefore, in case of an injury or death of a third party, the third party can
raise a claim under such a policy and receive the insured amount.
 ● Own-damage insurance policy: In case of any damage to your
vehicle due to fire or rain, or theft, you can raise a claim under this policy to
compensate you for the expenses incurred for repairing your vehicle.

● Comprehensive insurance policy: This type of insurance policy

provides you the best of both worlds as it provides both third-party cover and
own damage cover. Even if your car gets stolen, you can file a claim under
such a policy and get compensated.

- Bear in mind that you cannot raise any claim under any type of
motor insurance policy, if:

● You were driving your vehicle without a valid driving license

● You were driving the vehicle under the influence of drugs or

alcohol

● You were using the vehicle for any unlawful activity

=> If you want to purchase a new vehicle, you should start shopping for a motor
insurance policy as soon as you can. It makes little sense to wait right till the end, as
finding the perfect policy that suits your needs can take a while. The sooner you
begin, the more options you will have to choose from.

- example: when you collide with other vehicles while transmitting

information, often car owners force you to pay for car repair costs (if
you're wrong).
- In this case, motorbike civil liability insurance will stand on your
behalf to pay for the repair of the damaged party's vehicle,

d. Travel insurance
 (?) Have you ever been in any unexpected situation when you’re on a trip?
(?) What is the solution for that situation?

● Definition: Travel insurance is an insurance product for covering

unforeseen losses incurred while traveling, either internationally or
domestically. Basic policies generally only cover emergency medical
expenses while overseas, while comprehensive policies typically
include coverage for trip cancellation, lost luggage, flight delays,
public liability, and other expenses.
● Common benefits
- Medical: In the event of minor injury or illness overseas, medical benefits
offer coverage for visits to general practitioners, medicine, ambulance fees,
and limited dentistry benefits. In the event of hospitalization, most travel
insurance policies include emergency assistance services, which can offer
guarantees of payment to hospitals for treatment, liaise treating doctors, and
organize transfers between hospitals or medical evacuations back to the
insured person's country of origin.[5] More comprehensive policies include an
emergency companion cover, so that a family member can remain with the
insured person while in hospital. In the event of death overseas, medical
benefit sections typically include cover for repatriation of remains to insured
person's the country of origin, or a funeral overseas.
- Cancellation: Comprehensive travel insurance policies include cover for any
cancellation fees or lost deposits relating to cancellation of the insured's
person's trip for a range of unforeseen and unexpected circumstances. These
include illness or injury, natural disasters and bad weather,[6] strikes and
riots,[7] hijacking, and family emergencies.[8] Depending on the policy, it may
also include cancellation due to jury service, being made redundant from
full-time employment, having annual leave revoked for those in the armed
forces or emergency services, and prohibition of or advisory against travel
by a government to a particular destination.
- Alternative transport and travel expenses: Many policies include benefits for
alternative transport, accommodation, and meal expenses if the transport
 provider is delayed by a certain period, provided any layover times met the
criteria in the policy.[9] Policies may also include a benefit to purchase
essential items like clothing and toiletries in the event baggage is delayed by
an airline.
- Luggage: Luggage benefits cover for loss, damage or theft of personal
effects during one's journey, including passports and other travel documents.
It may also include limited benefits for theft of cash.
- Public liability: This covers legal liability as a result of a claim made against
the covered party for bodily injuries or damage to property of other persons.
e. Life insurance to protect a family
● Definition: Family life insurance policies typically cover the needs of
family members, including income replacement, final expenses, debt
repayment, and other essential financial obligations. Sometimes, a
family life policy may provide funds to cover funeral or burial
expenses.

● Is it worth buying life insurance for your parents? (Question)

Purchasing life insurance for your parents is a great way to secure their financial
future and protect against unpaid expenses after they pass away. Such essential final
costs could include the following:
 - Funeral expenses: In an already painful time, you don’t want to add
financial strain on top of it all. The costs for a funeral can be
overwhelming and range from $6,000 to $12,000 – but life insurance
plans offer the opportunity to lessen these worries. Not only will this
provide coverage of expenses at a difficult time, but it also offers
peace of mind that your loved ones won’t have extra stress while they
grieve.

- Debts: With life insurance, parents can provide their family with a
financial safety net in the event of their untimely death. Any
remaining debts, such as mortgages or credit card bills, can be paid
off to ensure that loved ones are not left struggling financially during
an already difficult time.

- Medical bills: Even if your parents had sizable and unpaid medical
bills, life insurance could assist in paying them off.

f. Property insurance
- Definition: Property insurance is a type of insurance that provides protection
against risks affecting the property. It primarily provides property protection
coverage. In other words, the insurer delivers financial reimbursement when
property damage occurs. Its main purpose is to protect the policyholder’s
property at the time of the loss.

- Types:
1. Homeowners Insurance

It offers financial security to the house against damage from events like theft and
catastrophes. Additionally, it provides coverage on belongings and liability
coverage.

2. Condo Insurance

It provides financial protection against damage and loss to the condominium units
owned by the condo homeowners. Generally, it does not cover the exterior portion
of the building but rather the home’s interior belongings, including walls, floors,
and internal equipment such as electronic appliances, furniture, clothes, etc.

3. Landlord Insurance

It is a complete service that provides financial security to those who rent out their
properties. In addition, the landlord’s interests are considered to protect the estate or
property and its belongings against unfortunate events.

4. Renters Insurance

It helps the owners/renters rent the property to other people. It does not cover the
whole structure of the property but provides additional protection against the
personal belongings of the property.

5. Flood Insurance

Its application adds a layer of security by providing coverage for losses caused by
floods due to prolonged or heavy rainfall, snow, high tides, thunderstorms,
monsoon rainfalls, clogged drainage systems, or dam collapse.

- Example: Homeowner’s insurance can cover dog bites, given the existence
of exclusions. For example, various home insurance providers won’t cover
dog-bite claims if the policyholder has a dog that is a type mentioned on the
 banned dog breed list, Pit bulls, Rottweilers, and Doberman Pinschers are
three breeds of dogs frequently appearing on lists of prohibited breeds.

(?) Assume Mr.A has such coverage, and if his pet dog bit someone, what
will the insurance cover? -> The insurance will cover the medical bills, given
the pet dog is not a type mentioned in the banned dog breed list.

e. Credit card insurance

(?) Can you guess the definition of credit card insurance?

- Definition: Credit card insurance is coverage for situations in which

someone fraudulently uses your credit card.
- Examples of these insurances include car rental insurance, trip cancellation
insurance, trip interruption insurance, travel medical insurance and purchase
warranty insurance.

3. Pros and cons:

PROS:

Introduction: Insurance is a crucial component of personal and business

financial planning. It offers a wide range of benefits, from protecting against
financial losses to providing peace of mind. Here are 8 most important benefits of
insurance that everyone should consider:

1. Risk Transfer
Insurance companies assume the risk of financial loss from policyholders in
exchange for a premium payment. This helps individuals and businesses transfer
their financial risk to an insurance company, reducing their exposure to
significant financial losses. For example, car insurance protects drivers against
financial losses resulting from car accidents.

2. Peace of Mind

Insurance provides peace of mind by reducing anxiety and stress related to

potential losses. It allows individuals and businesses to focus on their daily
activities and achieve their goals without worrying about what could go wrong.
For example, life insurance provides peace of mind knowing that loved ones will be
taken care of in case of an unexpected death.

3. Legal Compliance

Insurance is often required by law in many cases. A large number of businesses

are required to have workers' compensation insurance. Compliance with legal
requirements can help individuals and businesses avoid legal penalties and protect
themselves from liability. For example, business liability insurance protects
companies from legal liability claims.

4. Investment

Insurance policies can serve as investment vehicles, allowing individuals to

build wealth over time while also providing protection against risk. For
instance, life insurance or annuities can provide a way for individuals to save for
retirement, fund education expenses, or leave a legacy for their loved ones.

5. Tax Benefits
Certain types of insurance policies offer tax benefits, which can help individuals
and businesses reduce their tax liability. For example, contributions to a health
savings account (HSA) are tax-deductible, and the earnings on the account grow
tax-free.

6. Business Continuity

Insurance helps businesses maintain continuity in the event of unexpected

events, such as natural disasters or accidents. Business interruption insurance, it
can help cover expenses and lost income during a period of interruption.

7. Social Benefits

Insurance provides social benefits to society as a whole. By providing financial

protection to individuals and businesses, insurance helps prevent economic losses
that could have a ripple effect on the broader economy. For instance, insurance
coverage for natural disasters can help communities recover faster from disasters.

8. Financial Protection

The primary benefit of insurance is financial protection against unexpected

events that could cause significant financial losses. Insurance policies can cover
various types of risks, such as accidents, illness, property damage, and liability
claims. health insurance protects against unexpected medical expenses, while
homeowners' insurance protects against property damage caused by natural
disasters.

So now i will give you an example about the benefit of insurance in financial
protection:

Let's say that you have a homeowner's insurance policy that covers damage to
your home and personal property caused by a fire. One day, a fire breaks out in
your home, causing significant damage to the structure of the house and
destroying many of your belongings. Without insurance, you would be responsible
for paying for the repairs and replacing your lost possessions out of your own
pocket, which could cost you a lot of money or more.
This financial protection provided by your insurance policy can help you avoid
significant financial losses and allow you to recover more quickly from the
unexpected event.

Conclusion

In conclusion, insurance offers a wide range of benefits, including financial

protection, risk transfer, peace of mind, legal compliance, investment, and social
benefits. By investing in insurance coverage, individuals and businesses can
protect their financial stability, reduce their exposure to risk, and ensure they
are prepared for any eventuality. Everyone should consider the importance of
insurance and the benefits it offers in their personal and business financial
planning.

CONS:

A. Insurance has many terms and conditions

Insurance covers not all losses in a person's life or business situation. Insurance
plans' terms and conditions give consumers financial assistance solely in
accordance with those conditions. Therefore, one must carefully study and
comprehend the terms and circumstances before purchasing any insurance.

B. Long and costly legal procedures

The legal process to receive a claim submitted by an individual may be drawn out.
As a result, it occasionally may become problematic in an emergency. The cost of
an insurance plan can frequently fluctuate based on the type of policy a person
chooses as well as other considerations; occasionally, this cost may be higher than
the Insurance guaranteed. Therefore, people need to be conscious of the price.

C. Fraud insurance agency

The market is filled with a variety of fraud agencies. People who choose to
purchase Insurance before purchasing it must be capable of handling themselves
and the issue or seek professional assistance when choosing insurance firms.

D. Insurance might not cover all people

It might be an issue for certain people that some insurance, such as life and health
insurance, typically does not provide coverage for sick and elderly folks.

E. Potential illegal activity

Policyholders may be persuaded to engage in fraud or other criminal activity to

receive the promised insurance money, which may result in civil offenses.

F. Increases cost

Business owners are continuously looking for methods to cut costs and reviewing
budgets. Insurance can be pricey, particularly in sectors where workers'
compensation injuries are frequent. Insurance for the construction industry is more
expensive than Insurance for accountancy firms. A company should examine its
rules as it expands to ensure they continue meeting market demands. Otherwise, the
policy might only partially insure a loss, leaving the company inadequately
covered.

G. Additional fees

One would have to pay additional fees in addition to the premium. This additional
cost covers the broker fee. Because of a lack of efficient awareness, everyone is not
able to get knowledge of insurance, so one may need agents and have to pay an
extra amount for them. Purchasing excessive insurance coverage can also be
wasteful and result in higher-than-necessary rates.

H. Insurance brokers

Insurance brokers occasionally display a professionalism gap. They can think

they're pretending to be experts while looking to defraud people and gain financial
gain. They might even carry out their duties while utilizing a phony insurance
broker license or without a current license. As a result, one should request proof of
an insurance broker license before employing an intermediate service.

I. False sense of security

Insurance can give people a false sense of security, causing them to take
unnecessary risks or not take measures.

J. Cash surrender values are typically lower than premiums

In general, in all types of insurance, Cash surrender values are typically lower than
premiums paid in the first few years of the policy, and a policy owner may not be
able to recover all of the premiums paid if the policy is surrendered.
 QUESTIONS

1. How many ways by which the insurance company compensate for your
medical expenses?
A. 3 ways
B. 5 ways
C. 2 ways
D. 4 ways
2. What does personal possessions insurance cover?
A. Any item that belongs to you that you might use or carry in or out of your
home.
B. Any item that you afford and you might use or carry in or out of your
home.
C. Any item that you buy at the store and you might use or carry out of your
home.
D. Any item that belongs to you that you might not use or carry in or out of
your home.
3. There are 5 commons advantages when you use travel insurance
True / False
4. Illegal Compliance is one of the most importants benefits of insurance
True / False
5. Complete the definition
a) ……………… insurance is ………. for situations in which someone
fraudulently uses your credit card.

-> Credit card insurance is coverage for situations in which someone

fraudulently uses your credit card.

b) Insurance is a ………., represented by a policy, in which an …….. or

……. receives financial …….. or ………. against losses from an
insurance company.

-> Insurance is a contract, represented by a policy, in which an individual or

entity receives financial protection or reimbursement against losses from an
insurance company.

Phần Pros:

6. What is the purpose of business interruption insurance?

A) To cover expenses and lost income during a period of interruption (Answer: A)

B) To provide investment opportunities

C) To reduce tax liability

D) To provide social benefits

7. What is the benefit of life insurance besides financial protection?

A) It provides peace of mind (Answer: A)

B) It offers tax benefits

C) It helps maintain business continuity

D) It serves as an investment vehicle

8. How does insurance provide social benefits?

A) By reducing anxiety and stress related to potential losses

B) By allowing individuals to build wealth over time

C) By helping communities recover faster from disasters (Answer: C)

D) By providing tax benefits.

9 Financial protection is the primary benefit of insurance.

TRUE/FALSE