With respect, Permatex is a brand and not a product.  They market a wide
range of products some of which are suitable for this application.

IMHO proper installation of O rings require some type of lubrication in
order to allow the rubber to squirm or move into place as the part is
tightened, and also to prevent the rubber from being cut or abraded.  You
also do not want the ring to seal or bond itself to the housing as you may
need to remove it at some future time.  The best product will vary according
to specific application but in general almost anything will work, many
people use grease as it will also help to hold the ring in place as the part
is positioned but RTV silicone also works well, plain oil or in this case
coolant will also work.  Most of the Permatex gasket glues will work but
some of the hardening types will be difficult to remove if you need to
remove the part in the future.  Do not overuse anything as the excess will
only contaminate the contained fluid, (in this case the coolant).  As a
general rule lubricating with the contained fluid is seldom wrong.

I would also add that water pump seal failure is often caused by the drop
out of the abrasive silicate used in standard aluminum compatible antifreeze
coolant to reduce galvanic corrosion between the iron and aluminum parts of
the cooling system.  Now would be a good time to drain and flush the cooling
system then wash with a solution of Calgon dishwasher detergent before
repeated thorough flushing and installing new non-silicate type long life
coolant.  It is important to remove ALL of the standard coolant before
installing most types of long life coolants as most are incompatible.

Those who continue to use standard aluminum compatible coolant and
especially those who use old coolant will probably need to change their
water pumps sooner than those who do not.

Happy trails,  YMMV