Paid-up Policy:
Insurance on which the policyowner has completed payments, but which has not matured.  This may be either (1) reduced paid-up insurance provided under the nonforfeiture provision; (2) a limited payment policy under which all premiums have been paid; or (3) a policy on which accumulated dividend are applied to pay the net single premium required to pay up the difference between the policy’s reduced paid-up insurance and its face amount.

Paramedical (Paramed) exam:
See Medical examination.

Participating policy:
A life insurance policy under which the insured receives shares of the divisible surplus of the company.  Such shares are commonly called dividends.  The divisible surplus represents the difference between the premiums charged and the actual costs (reflecting claims, expenses, earnings, etc.) experienced during the period for which the premiums were charged.

Permanent life insurance:
A term loosely applied to cash value life insurance.  This type of policy is meant to last a whole life, as opposed to term, which is in force for a specified period of time or term.

Policy:
The written statement of the agreement between insurer and insured (or policyowner, if other than the insured), including all endorsements and attached papers, which constitutes the entire contract of insurance.  See contract and insurance policy.

Policy anniversary:
The anniversary of the date of issue of a policy, as shown in the policy schedule.

Policy fee:
A small charge made by some companies in addition to the premium.

Policy loan:
A loan made by the insurer to the (cash value) policyowner, with the cash value of the policy assigned as security for the loan.

Policy owner:
The person who has ownership rights in an insurance policy and who may or may not be the insured.

Preauthorized Check Plan:
A simplified method of paying premiums monthly.  Policyowners authorize the insurance company to draw automatically one payment per month in the amount of their premium from their bank checking account.

Preferred risk:
A person whose physical condition, occupation, mode of living, and other characteristics indicate a prospect for longevity which is superior to that of the average longevity of unimpaired lives of the same age.

Preferred Best risk:
A person whose physical condition, occupation, mode of living, and other characteristics indicate a prospect for longevity which is superior to that of the preferred risk of the same age.  Sometimes called preferred plus.

Premium:
The periodic payment required to keep a specific life insurance policy in force.

Premium Mode:
The specific period chosen to pay life insurance premiums (monthly, annually, quarterly, semi-annually).

Primary Beneficiary:
The beneficiary specifically designated by the insured as the first in priority to receive policy proceeds.

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