Transcript Slide 1
Chapter 18
Credit and
Insurance
©2008 Thomson/South-Western
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Chapter 18
Credit and Insurance
Lesson 18.1
Credit Principles and Practices
Goals
Describe three types of credit plans used by
businesses.
Identify several types of financial transaction
cards and the main uses of each type.
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Credit and Insurance
Credit Systems
Accepting major credit cards
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Creating a private credit card system
Consumer credit plans
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Merchant account provider
Installment credit
Revolving credit
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Credit and Insurance
Financial Transaction Cards
Bank and nonbank credit cards
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Co-branded credit cards
Affinity credit cards
Debit cards
Smart cards
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Credit and Insurance
Lesson 18.2 Managing Credit
Goals
Identify the information on which decisions
about credit applications is based and how
that information is obtained.
Describe the steps in collecting unpaid
accounts.
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Credit and Insurance
Determining Credit Standing
The four Cs of credit
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Sources of credit information
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Character
Capacity
Capital
Conditions
The point system
Applicants
Credit agencies
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Credit and Insurance
Federal Laws and the Credit Card
Industry
Equal Credit Opportunity Act
Truth-in-Lending Law
Fair Credit Reporting Act
Fair Debt Collection Practices Act
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Credit and Insurance
Analyzing Credit Sales
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Accounts receivable relative to credit sales
Aging of accounts
Percentage of delinquent accounts relative to
total outstanding accounts
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Credit and Insurance
Lesson 18.3 Insurance Principles
Goals
Discuss several ways that businesses can
attempt to reduce risks.
Define important insurance terms.
Describe several noninsurable risks facing
businesses and how managers can respond
to each.
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Credit and Insurance
Basic Insurance Concepts
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Insurance rate — amount an insurance company
charges a policyholder for a certain amount of
insurance
Cancellation of insurance
Insurable interest in property — possible financial
loss the policyholder will suffer if the property is
damaged or destroyed
Deductible — amount the insured party pays for a
loss before the insurance company pays anything
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Lesson 18.4
Types of Business Insurance
Goals
Describe several types of property and
vehicle insurance that businesses need.
Identify the types of insurance businesses
should consider carrying on the people
associated with the business.
Describe additional insurance businesses
may need to cover special types of risks.
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Credit and Insurance
Property Insurance
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Fire insurance
Burglary and robbery
insurance
Business income
insurance
Transportation
insurance
Vehicle insurance
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Collision insurance
Comprehensive
insurance
Vehicle liability insurance
Medical payments
insurance
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Credit and Insurance
Other Types of Insurance
Insuring people
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Other business insurance needs
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Health and disability insurance
Life insurance
Business operations — liability insurance,
malpractice insurance, bonding
Insurance for international operations
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Credit and Insurance