UNIT-5 [ Lesson-4: Bank and Insurance Letters ]
After reading this lesson you will be able to:
- explain the importance of bank and insurance letters
- identify various bank and insurance letters
- write bank and insurance letters
Bank and Insurance Letters
Bank Letters
A bank is a financial institution which serves its customers in various ways. For the smooth running of banking activities, often correspondence between a bank and its customers becomes necessary. To make banking letters effective some knowledge of banking functions is essential for the students of a management course.
The main functions of a bank are:
– A bank receives money from and credits money to its customers
– It gives loan, overdrafts etc.
– It deals with bills, etc.
Here are some model bank letters
a. Opening a current account
b. Cancellation of a cheque
c. Request for an overdraft/loan
b. Bank’s reply of Mr. Rahman’s letter:
ACTIVITY
- Write a letter to your banker asking for issuing an overdraft or for a loan. Give reasons.
- Write a letter to your banker inquiring about opening a savingaccount with.
Insurance letters
Insurance is a kind of undertaking by a company/enterprise to provide safeguard against loss, damage and injury in return for payments of premium. Thus an insurance policy is a contract against possible future risks.
It is, therefore, a common practice between business organisations and insurance companies to exchange insurance letters among themselves about insuring goods and properties against any damage.
There are various types of insurance such as, life insurance, fire insurance, marine insurance, car insurance etc.
Life insurance
A sum of money is insured which matures i.e., becomes payable to the insured person or his/her nominee, on the event of death or the attainment of a specified age, whichever is earlier. Life insurance money helps a man in old age or helps his dependents in the case of his death.
Sample life insurance letters
b. A reply to the above letter
Fire insurance
Fire accidents can cause huge losses to properties. So factories and organisations and often even private houses are insured against fire.
Sample fire insurance letters
Marine Insurance
Ships often sail on sea in the midst of many risks like storm, collision, fire, attack by pirates and so on. Any of these risks may cause heavy damage to the ship as well as its cargo. Marine insurance covers these risks, identifying the owners/traders against such losses.
Sample marine insurance letters
Car Insurance
Among other kinds of insurance such as, crop insurance, aviation insurance and so on, motor car insurance is very common, especially in urban life.
In most third world countries like ours, where traffic rules and regulations are more often violated than obeyed, road accidents are an everyday happening of city life. Hence, here lies the need for car insurance to indemnify the owners against any damage caused by such accidents.
Sample car insurance certificate and notice
I/We hereby Certify that the policy to which this certificate relates as well as this certificate of insurance are issued in accordance with the provisions of the chapter VIII of the Motor Vehicles Act. 1939, as amended in 1983 vide Government Notification dated 24-3-1983.
For & on behalf of
Bangladesh General Insurance Co. Ltd.
Date of issue ……………….
Issued at ……………………..
Examined by ……………….
ACTIVITY
- You are 35 years old. You want to take a life insurance policy for @ 75,000. Write a letter to an Insurance Company of your choice inquiring about the rate of premium and other relevant information.
- You are a car dealer. Write a letter asking for insuring 20 reconditioned cars shipped from Osaka to Chittagong. The policy will cover the cars in transit from Chittagong to Dhaka too.
- Now fill in the Certificate of Insurance form given on page………….