Glossary

A premium notice from the insurer states that the premium is or will soon be due.

A premium payment plan or installment plan that does not require an insured to pay the entire annual premium at the beginning of the policy period.

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.