Glossary

Prospecting in an insurance context is the act of looking for potential buyers of insurance.

Prospective aggregates refer to spread loss programs giving accident year reinsurance for long-tail risks with premiums paid annually over the expected life of the policy. Any adjustments in pricing resulting from adverse loss development occur prospectively.

Prospective rating is a method used in arriving at an insurance or reinsurance rate and premium for a policy period based on the loss experience of a prior period. Schedule credits, experience modification, and individual risk rating modifications are factors used in prospective rating, whereas losses incurred during the policy period have no effect on final premium. Guaranteed cost plans, with or without a dividend, are examples of prospectively rated insurance plans.

The prospective reserve is a reserve amount designated as a liability for life and health insurance companies to pay the difference between projected benefits and projected premiums, including investment income.

Protection and indemnity (P&I) insurance is liability insurance for practically all maritime liability risks associated with the operation of a vessel, other than that covered under a workers compensation policy and under the collision clause in a hull policy. There is no standard P&I form with the specific terms and conditions for each insured tailored by underwriters based on the nature of the risk and the character and amount of insurance desired by the insured. Additionally note that since the P&I policy is essentially a contract of indemnity, the insurer is not obligated to pay unless the insured must actually pay the claim.

Protection classes are the 10 categories used by the Insurance Services Office, Inc. (ISO), to rank the fire protection in cities and towns according to these four factors. Fire department quality. This includes its equipment, staffing (i.e., paid or volunteer), training, and geographic distribution of firefighting companies. This factor accounts for 50 percent of the total classification. Water supply system. This includes the condition, distribution, inspection, and maintenance of fire hydrants and a comparison of the available water to the amount needed to extinguish a fire. This accounts for 40 percent of the total classification. Fire alarm and communications systems. These include telephone systems, telephone lines, staffing of these systems, and the quality of the dispatching system. This factor accounts for 10 percent of the total classification. Community risk reduction. This involves a community's efforts in fire risk reduction, such as fire prevention code adoption and enforcement, public fire safety education, and fire investigation The ISO public protection classification (PPC) program is a rating system that measures the quality of public fire protection in fire districts across the country, ranging from 1 (best) to 10 (worst). While nearly all US insurers use ISO's PPC system in calculating insurance rates for homes, many insurers deviate from the rules of the PPC program through the use of independently filed rules.

Protective liability insurance is a general term describing a type of liability insurance that is purchased by an indemnitor, such as a contractor, for its indemnitee, such as the project owner, to protect the indemnitee against liability for bodily injury (BI) or property damage (PD) arising out of the indemnitor's operations.

A protective order is any order or decree of a court whose purpose is to protect a party from harassment or further discovery.

Protective professional indemnity insurance is first-party insurance that provides supplemental coverage for professional errors and omissions (E&O) claims against the insured's design professionals. The policy sits on top all of the insured's design professionals' practice policies as a form of excess coverage in the event the design professional's policy limit has been exhausted or is not sufficient to pay the insured's claim. The insured (e.g., project owner or contractor) must prove a legal claim for professional negligence against the design professional to collect under the policy.

A protective safeguards endorsement to property insurance makes it a condition of coverage that the protective safeguards cited in the endorsement (such as an automatic sprinkler system or night watch guard) be in operation at all times except when the insurer has been notified of the impairment in protection. Failure to maintain the protective safeguards in good working order or failure to notify the insurer of even a temporary impairment in protection suspends coverage until the protection is restored.