Life Insurance Glossary - P

Package Policy
A combination of two or more individual polices into a single policy. A householders policy, for example, is a package policy.

Partial Disability
The result of an illness or injury which prevents an insured from performing on or more of the functions of his/her regular job

Particular Average
A term meaning an accidental and usually a partial loss suffered by one interest and not chargeable against others

Peril
The event insured against; the cause of possible loss

Personal Injury
In law, a term used to embrace a broad range of torts that includes bodily injury, libel, slander, discrimination and similar offences. Also a standard insurance coverage that protects against a more limited group of torts (false arrest, detention or imprisonment, malicious prosecution, wrongful entry or eviction, and libel, slander, or defamation)

Physical Damage
Damage to or loss of an automobile resulting from a named peril

Physical Hazard
A condition of the subject of insurance which creates or increases the chance of loss, such as structural defects, occupancy, or similar conditions

Pilferage
Petty theft, especially theft of articles in less than package lots.

Policy
The legal document issued by the company to the policyholder, which outlines the conditions and terms of the insurance; also called the policy contract for the contract

Policyholder
The person (or persons) whose risk of financial loss from an insured peril is protected by the policy.

Policyholder's funds
Monies set aside by insurers to cover outstanding liabilities to Policyholders. Also known as technical reserves

Policy Period
The term for which insurance remains in force, sometimes definite, sometimes not.

Policyholder's surplus
Amount over and above liabilities available for an insurer to meet future obligations to its policyholders

Policy Term
The period for which an insurance policy provides coverage

Policyholder
A person who pays a premium to an insurance company in exchange for the insurance protection provided by a policy of insurance

Pool
A risk sharing mechanism in which the members of a group agree to be collectively responsible for losses

Premium
The sum paid by a policyholder to keep an insurance policy in force. It is the amount paid to secure an insurance policy

Premium Notice
Notice of a premium due, sent out by the company or one of its agencies to an insured. Synonym for " Renewal Notice".

Principal
The applicant for, or subject of, insurance; the one from whom an agent derives his or her authority

Pro Rata Cancellation
Cancellation with a return of premium charged for the period of time the policy was in force equal to the ratio of the total premium to the total policy period

Product Liability Insurance
Protection against financial loss arising out of the legal liability incurred by a manufacturer, merchant, or distributor because of injury or damage resulting from the use of a covered product

Professional Indemnity
It is a cover granted to professionals like Doctors covering their legal liability for any claims arising out of professional misconduct

Property Insurance
Insurance providing financial protection against the loss of, or damage to, real and personal property caused by such perils as fire, theft, windstorm, hail, explosion, riot, aircraft, motor vehicles, vandalism, malicious mischief, riot and civil commotion, and smoke

Proposal
A person interested in taking out insurance has to make an offer by means of a proposal. This is an application for the cover required, or for obtaining quotations of the premium chargeable

Proposal Form
It is a form which is to be completed for securing an insurance policy

Proposer
Proposer is a person who proposes the insurance policy

Prospectus
A form, which is often part of the proposal form, giving details of the cover available with particulars of extra benefits and rebates

Protection and Indemnity (P & I) Insurance
Liability insurance coverage in an ocean marine policy

Provision for unexpired risks
Amount set aside on the balance sheet in addition to unearned premiums with respect to risks to be borne by the insurance undertaking after the end of the financial year, in order to pro-vide for all claims and expenses in connection with insurance contracts in force in excess of the related unearned premiums and any premiums receivable on those contracts

Provisions
The terms or conditions of an insurance policy

Proximate Cause
The dominating cause of loss or damage; an unbroken chain of events between the occurrence and damage

Public Liability/Third Party Liability
The insured's liability at law (excluding liability to an employee arising out of employer/employee relationship) to pay compensation for death, injury or illness sustained by any person or damage to property caused by explosion or collapse of boiler and pressure plant or use of lilting and handling plant

Punitive Damages
Damages awarded separately and in addition to the compensatory damages, usually on account of malicious or wanton misconduct, to serve as a punishment for the wrongdoer and possibly as a deterrent to others

Pure Risk
A condition in which there is the possibility of loss or no loss only.


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