Glossary

Product liability insurance provides protection against financial loss arising out of the legal liability incurred by an insured because of injury or damage resulting from the use of a covered product. It is a component of standard general liability insurance.

Product recall is a type of insurance coverage for the cost of getting a defective product back under the control of the manufacturer or merchandiser that would be responsible for possible bodily injury (BI) or property damage (PD) from its continued use or existence.

Professional liability refers to a type of liability coverage designed to protect professionals and businesses from errors and omissions in performing their professional services. This coverage can protect traditional professionals (e.g., accountants, attorneys) and quasi-professionals (e.g., real estate brokers, consultants). Although there are a few exceptions (e.g., physicians, architects, engineers), most professional liability policies only cover economic or financial losses suffered by third parties, as opposed to bodily injury (BI) and property damage (PD) claims that are typically covered under commercial general liability (CGL) policies. The vast majority of professional liability policies are written with claims-made coverage triggers, and the insurer's payment of defense costs reduces available policy limits.

A professional reinsurer is a company whose business is confined solely to reinsurance and the peripheral services offered by a reinsurer to its customers.

The professional services exclusion is an exclusion commonly endorsed onto general liability policies and found within directors and officers (D&O) liability insurance policies.

Profit center captives are captives that have the primary function of earning underwriting income by writing unrelated risk.

A profit commission is a provision found in some reinsurance agreements that provides for profit sharing.

A profit sharing plan is a defined contribution benefit plan that does not promise a set amount at retirement.

Program business refers to groupings of insurance customers or applicants with common operations that often form associations or risk purchasing groups (RPGs).

A program business captive is a captive that insures or reinsures a "program"—that is, a group of homogeneous risks, none of which is individually underwritten.