Dictionary of Insurance Terms -I-

-I-

• 
  Imputed Negligence: Case in which
  responsibility for damage can be transferred from the negligent party to
  another person, such as an employer.
• 
  Incurred Claims: Incurred claims equal
  the claims paid during the policy year plus the claim reserves as of the
  end of the policy year, minus the corresponding reserves as of the beginning
  of the policy year. The difference between the year end and beginning of
  the year claim reserves is called the increase in reserves and may be added
  directly to the paid claims to produce the incurred claims.
• 
  Incurred-but-not-reported (IBNR)
  reserves: liability account on an insurer’s balance sheet reflecting
  claims that are expected based upon statistical projections but which have
  not yet been reported to the insurer
• 
  Indemnification: Compensation to the
  victim of a loss, in whole or in part, by payment, repair, or replacement.
• 
  Indemnity: Legal principle that specifies
  an insured should not collect more than the actual cash value of a loss
  but should be restored to approximately the same financial position as
  existed before the loss.
• 
  Independent Adjustor: Claims
  adjustor who offers his or her services to insurance companies and is compensated
  by a fee.
• 
  Independent Agent: an independent
  business person who usually represents two or more insurance companies
  in a sales and service capacity and who is paid on a commission basis.
• 
  Independent Agency System:
  Type of property and liability insurance marketing system, sometimes called
  the American agency system, in which the agent is an independent businessperson
  representing several companies. The agency owns the expirations or renewal
  rights to the business, and the agent is compensated by commissions that
  vary by line of insurance.
• 
  Indirect Loss: See Consequential
  Loss.
• 
  Individual Insurance: Policies
  which provide protection to the policyholder and/or his/her family. Sometimes
  called Personal Insurance as distinct from group and blanket insurance.
• 
  Individual Retirement
  Account (IRA): An account to which an individual can make annual contributions
  of 100% of earnings up to $2,000 ($2,250 for a one-income married couple).
  These contributions are tax deductible for most workers.
• 
  Industrial Life Insurance:
  Life insurance issued in small amounts, usually less than $1,000, with
  premiums payable on a weekly or monthly basis. The premiums are generally
  collected at the home by an agent of the company. Sometimes referred to
  as debit insurance.
• 
  Inflation-Guard Endorsement:
  Endorsement added at the insured’s request to a homeowners policy to increase
  periodically the face amount of insurance of the dwelling and other policy
  coverages by a specified percentage.
• 
  Inheritance tax: A tax on the right
  of an heir to receive property at the death of another.
• 
  Initial Past Service Liability:
  The actuarial value (single sum) of the past service benefits as of the
  effective date of the establishment of the plan, or at the date of the
  latest liberalization. The maximum annual past service contribution allowable
  for tax deduction is the amount necessary to amortize past service liabilities
  and other supplementary pension or annuity credits over 10 years. Funding
  of the past service liability over a period of 30 years (40 in some cases)
  is required by the Internal Revenue Service under ERISA.
• 
  Injury Independent
  of All Other Means: An injury resulting from an accident, provided
  that the accident was not caused by an illness.
• 
  Inland Marine Insurance: A
  broad form of insurance, generally covering articles in transit as well
  as bridges, tunnels and other means of transportation and communication.
  Besides goods in transit (generally excepting trans-ocean), it includes
  numerous “floater” policies, such as those covering personal effects, personal
  property, jewelry, furs, fine arts, and other items.
• 
  Inland Marine Insurance: A
  broad type of insurance, generally covering articles that may be transported
  from one place to another as well as bridges, tunnels and other instrumentality’s
  of transportation. It includes goods in transit (generally excepting trans-ocean)
  as well as numerous “floater” polices such as personal effects, personal
  property, jewelry, furs, fine art and others.
• 
  Inspection Report: A report (usually
  written) of an investigation of an applicant, conducted by an independent
  agency that specializes in insurance investigations. The report covers
  such matters as occupation, financial status, health history, and moral
  problems.
• 
  Insolvent: Having insufficient financial
  resources (assets) to meet financial obligations (liabilities).
• 
  Insurability: Acceptability to the company
  of an applicant for insurance.
• 
  Insurable Risk: The conditions that
  make a risk insurable are (a) the peril insured against must produce a
  definite loss not under the control of the insured, (b) there must be a
  large number of homogeneous exposures subject to the same perils, (c) the
  loss must be calculable and the cost of insuring it must be economically
  feasible, (d) the peril must be unlikely to affect all insureds simultaneously,
  and (e) the loss produced by a risk must be definite and have a potential
  to be financially serious.
• 
  Insurance: A system under which individuals,
  businesses, and other organizations or entities, in exchange for payment
  of a sum of money (a premium), are guaranteed compensation for losses resulting
  from certain perils under specified conditions.
• 
  Insurance: Protection by written contract
  against the financial hazards (in whole or in part) of the happenings of
  specified fortuitous events.
• 
  Insurance Company: An organization
  chartered to operate as an insurer.
• 
  Insurance Company: Any corporation
  primarily engaged in the business of furnishing insurance protection to
  the public.
• 
  Insurance Commissioner: The
  top insurance regulatory official in a state.
• 
  Insurance Exchange: Term used to
  describe a facility that exists in a few states to provide a market for
  reinsurance and for the insurance of large and unusual domestic and foreign
  risks that are difficult ot insure in the normal markets. Examples are
  the New York Insurance Exchange, the Insurance Exchange of the Americas,
  and the Illinois Insurance Exchange.
• 
  Insurance Examiner: The representative
  of a state insurance department assigned to participate in the official
  audit and examination of the affairs of an insurance company.
• 
  Insurance Guaranty Funds:
  State Funds that provide for the payment of unpaid claims of insolvent
  insurers.
• 
  Insurance Services Offices (ISO):
  Major rating organization in property and liability insurance that drafts
  policy forms for personal and commercial lines of insurance and provides
  rate data on loss costs for property and liability insurance lines.
• 
  Insured: A person or organization covered
  by an insurance policy, including the “named insured” and any other parties
  for whom protection is provided under the policy terms.
• 
  Insurer: The party to the insurance contract
  who promises to pay losses or benefits. Also, any corporation engaged primarily
  in the business of furnishing insurance to the public.
• 
  Insuring Agreement: That part of
  an insurance contract that states the promises of the insurer.
• 
  Insuring Clause: The clause which
  sets forth the type of loss being covered by the policy and the parties
  to the insurance contract.
• 
  Integration: A coordination of pension,
  disability or other benefit with the other sources of income, such as Social
  Security benefit, through a specific formula designed to ensure reasonable
  income replacement.. Qualified plans must integrate so that total benefits
  are non-discriminatory between rank and file employees and owners, officers
  or highly compensated employees.
• 
  Inter vivos Trust:
  A trust created while the creator of the trust is living. Also known as
  a living trust.
• 
  Interest: Money paid for the use of money.
• 
  Interest Option: Life insurance settlement
  option in which the principal is retained by the insurer and interest is
  paid periodically.
• 
  Intestate: Without a will.
• 
  Investment Income: The income generated
  by a company’s portfolio of investments (such as in bonds, stocks, or other
  financial ventures).
• 
  Investment Income: The portion of
  a company’s income which is derived from its investments, including interest
  and dividends on stocks and bonds.
• 
  Investment Only Contract:
  Type of funding instrument that uses only the investment services of an
  insurer.
• 
  IPG Plan: See Immediate Participation
  Guarantee Plan.
• 
  IRA: See Individual Retirement Account.
• 
  ISO: See Insurance Services Office.