Package Policy:

A policy providing several different coverages combined into one policy. Refers to a policy providing both general liability insurance and property insurance.

Paid-Up Additional Insurance:

An option that allows the policyholder to use policy dividends and/or additional premiums to buy additional insurance on the same plan as the basic policy and at a face amount determined by the insured's attained age.

Payroll Limitation:

A limit on the amount of payroll for certain classifications used for the development of premium.

Peril:

Cause of loss such as fire, windstorm, collision, etc.

Personal Auto Policy (PAP):

A policy insuring private-passenger autos owned by individuals.

Personal Injury:

A General Liability coverage for insurable offenses that cause harm, other than bodily injury, such as false arrest, detention or imprisonment, malicious prosecution, wrongful eviction, slander, libel and invasion of privacy.

Personal Injury Protection (PIP):

An automobile insurance coverage mandated by law in some states. The statutes typically require insurers to provide or offer to provide first-party benefits for medical expenses, loss of income, funeral expenses and similar expenses without regard to fault.

Personal Lines:

Insurance for individuals and families, such as private-passenger auto and homeowners insurance.

Personal Property:

All tangible property not classified as real property such as contents.

Point-of-Service Plan:

Health insurance policy that allows the employee to choose between in-network and out-of-network care each time medical treatment is needed.

Policy:

The printed document given to the insured, outlining the terms and conditions of the Insurance coverage.

Policy Fee:

A one-time charge per policy that does not change with the size of the premium.

Policy Holder:

The person who owns a life insurance policy. This is usually the insured person, but it may also be a relative of the insured, a partnership or a corporation.

Policy Period:

The term or duration of a policy including the effective and expiration dates.

Policy or Sales Illustration:

Material used by an agent and insurer to show how a policy may perform under a variety of conditions and over a number of years.

Pollutant:

An irritant or contaminant, whether in solid, liquid, or gaseous form, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.

Pre-Existing Condition:

A coverage limitation included in many health policies which states that certain physical or mental conditions, either previously diagnosed or which would normally be expected to require treatment prior to issue, will not be covered under the new policy for a specified period of time.

 Preferred Auto

Auto coverage for drivers who have never had an accident and operates vehicles according to law. Drivers are not a risk for any insurance company that writes auto insurance, and no insurance company would be afraid to take them on as risk.

Preferred Provider Organization

Network of medical providers who charge on a fee-for-service basis, but are paid on a negotiated, discounted fee schedule.

Preferred Risk:

A positive characteristic of someone seeking to be insured. Usually means a better likely hood for long life, and usually means a lower premium.

Premises:

The location where coverage applies.

Premises-Operations:

A category of hazard ordinarily insured by a general liability policy which is composed of those exposures to loss that fall outside the defined 'products-completed operations hazard,' including liability for injury or damage arising out of the insured's premises or out of the insured's business operations while such operations are in progress.

Premium:

The price of insurance protection for a specified risk for a specified period of time agreed upon. Payment made to keep an insurance policy in force, usually a monthly payment.

Premium Flexibility:

The policy holder's right to vary the amount of premium paid each month.

Premium Balances:

Premiums and agents' balances in course of collection; premiums, agents' balances and installments booked but deferred and not yet due; bills receivable, taken for premiums and accrued retrospective premiums.

Premium Earned:

The amount of the premium that as been paid for in advance that has been "earned" by virtue of the fact that time has passed without claim. A three-year policy that has been paid in advance and is one year old would have only partly earned the premium.

Premium to Surplus Ratio:

This ratio is designed to measure the ability of the insurer to absorb above-average losses and the insurer's financial strength. The ratio is computed by dividing net premiums written by surplus. An insurance company's surplus is the amount by which assets exceed liabilities. The ratio is computed by dividing net premiums written by surplus.

Premium Unearned:

That part of the premium applicable to the unexpired part of the policy period.

Pretax Operating Income:

Pretax operating earnings before any capital gains generated from underwriting, investment and other miscellaneous operating sources.

Pretax Return on Revenue:

A measure of a company's operating profitability and is calculated by dividing pretax operating earnings by net premiums earned.

Primary Beneficiary:

In life insurance, the beneficiary designated by the insured as the first to receive policy benefits.

Primary Policy:

The insurance policy that pays first when you have a loss that's covered by more than one policy.

Private-Passenger Auto Insurance Policyholder Risk Profile:

Refers to the risk profile of the auto insurance policyholder and can be divided into three categories: standard, nonstandard and preferred. In the eyes of an insurance company, it is the type of business (or the quality of driver) that the company has chosen to taken on.

Pro Rata Cancellation:

The cancellation of an insurance policy with the return premium being the full proportion of premium for the unexpired term of the policy, without penalty for early cancellation.

Product:

Items manufactured, sold, handled, distributed or disposed of by the named insured or others involved with the named insured in the course of their business. Includes containers, parts and equipment, product warranties and provision of or failure to provide instructions and warnings.

Product Liability:

The liability for bodily injury or property damage a merchant or manufacturer may incur as a consequence of some defect in the product sold or manufactured.

Products-Completed Operations:

General Liability coverage for liability arising out of the insured's products or business operations conducted away from the insured's premises once those operations have been completed.

Profit:

A measure of the competence and ability of management to provide viable insurance products at competitive prices and maintain a financially strong company for both policyholders and stockholders.

Professional Liability:

Coverage designed to protect professionals such as physicians and real estate brokers, against liability incurred as a result of errors and omissions in performing professional services.

Property Damage:

In the general liability policy, a physical injury to property, resulting in the loss of use.

Property Insurance:

First-party insurance for real and personal property against physical loss or damage.

Provisions:

Details of an insurance policy which explain the benefits, conditions and other features of the insurance contract.

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