Glossary

Premium prepayment is when the insured makes payment of future premiums.

Premium reserve is accounting process allocating the premium paid for an insurance policy over the life of the policy.

Premium tax refers to a tax, imposed by each state, on gross premium written by insurers allocable to risks located in that state.

A prepaid legal plan is an employee benefit plan that provides free or low-cost legal services to employees.

Preponderance of evidence is an amount of evidence in support of a cause that, on the whole, is more convincing than the evidence offered in opposition to it.

The present value is the value today of a future payment, or payments, discounted at an appropriate interest rate.

A presumption is an assumption that a factual conclusion can be made if specified conditions are met.

The presumptive indemnification provision, found in most directors and officers (D&O) liability policies, states that, in a claim situation, it is presumed that the corporate organization has indemnified its directors and officers to the fullest extent permitted by law, regardless of whether the corporation does, in fact, indemnify them.

Primary and noncontributory is a term commonly used in contract insurance requirements to stipulate the order in which multiple policies triggered by the same loss are to respond. For example, a contractor may be required to provide liability insurance that is primary and noncontributory. This means that the contractor's policy must pay before other applicable policies (primary) and without seeking contribution from other policies that also claim to be primary (noncontributory).

The primary beneficiary is the beneficiary named as being first to receive proceeds or benefits when they come due or are payable.