Page 513 - Business Principles and Management

Unit 5

policies. Businesspeople should keep in mind that the insurance laws of the
country in which the business is operating apply to loss situations. To encourage
international business with developing countries, the U.S. government formed
the Overseas Private Investment Corporation. The corporation provides insur-
ance coverage for businesses that suffer losses or damage to foreign investments
as the result of political risks. Although coverage is expensive, companies can
even purchase insurance that covers losses suffered if the purchasers of exports do
not pay for their purchases. Companies that are just beginning to engage in inter-
national trade or have not worked with a specific international company before
may want to consider such insurance. Businesses shipping products to other
countries should also obtain special transportation insurance, because several
different companies and transportation methods may be involved as the prod-
ucts move from country to country.

CHECKPOINT
What types of businesses require malpractice insurance?

18.4 Assessment

UNDERSTAND MANAGEMENT CONCEPTS
Determine the best answer for each of the following questions.
1. Payments to employees who cannot work because of accidents or
illnesses are offered through ______ insurance.
a. health
b. malpractice
c. disability
d. liability
2. A special type of insurance that pays damages to people whose
losses are caused by the negligence or dishonesty of an employee
or by the failure of the business to complete a contract is
a. bonding
b. beneficiary
c. agent
d. preferred provider

THINK CRITICALLY
Answer the following questions as completely as possible.
3. If you are choosing among employers for a full-time job and one
offers health insurance and the other does not, how important
would that be in deciding which job to choose? Why?
4. How does having life insurance policies on the owners of a
partnership help protect the business in case of
the death of one of the partners?

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