Insurance Glossary: I-K

Question: What is Identity Fraud?

Answer: Identity fraud is one of the fastest growing perils that can cause massive financial loss for an individual or business. Information is often improperly obtained and used to access credit fraudulently.

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Question: What is Identity Fraud Expense Insurance?

Answer: Identity fraud expense insurance helps to cover some of the related expenses, particularly postage and phone charges required to correct a victims identity including account information, credit history, and initiating extensive communications with a multitude of lenders, businesses and legal authorities. Unfortunately, many people wrongly expect this coverage to pay the actual loss sustained from the fraudulent act. It will cover only the contingent loss which can be extensive and many times more than the loss that isn’t covered.

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Question: What is Impaired Risk?

Answer: Impaired risk is when a person seeking health of life insurance is in substandard physical shape or is involved in a dangerous hobby or employment position. Many insurance companies avoid impaired risks, while others specialize in them.

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Question: What are Improvements and Betterments?

Answer: Improvements and betterments are enhancements made to real estate property to improve its value. Beyond basic repairs and replacements. Usually by a tenant.

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Question: What is Imputed Negligence?

Answer: Imputed negligence is a situation in which the responsibility for loss or damage is transferred, as from a child to a parent.

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Question: What is In Kind?

Answer: In kind is the replacement of damaged, destroyed, or lost property with other similar property instead of cash.

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Question: What is Increase in Hazard?

Answer: The standard fire insurance policy is suspended from liability during the increase in hazard beyond what was contemplated at the time the policy was written. For example, if a dwelling house, insured as such, should be occupied for manufacturing purposes without getting consent from the insurer for such increase in hazard, the company would not have to pay a loss as long as the manufacturing condition exists. This is often determined after the fact by courts and rarely comes into play in loss settlement.

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Question: What is Increasing Term Insurance?

Answer: In an increasing term insurance policy, the death benefit increases with time.

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Question: What are Incurred Losses?

Answer: Incurred losses are events which cause claims to be made. The total amount shown in an insurance company’s financial statement as its obligations for policy claims.

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Question: What is Indemnity?

Answer: Indemnity is security or protection against loss.

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Question: What is an Indemnity Agreement?

Answer: An indemnity agreement is a contract that restores an injured party or parties to the condition that was present prior to the loss.

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Question: What is an Independent Adjuster?

Answer: An independent adjuster provides claims adjustment services to insurance companies but is not employed by that company.

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Question: What is an Independent Agency System?

Answer: Often called the “American” agency system. In the independent agency system, insurance companies contract with independent insurance agents to sell and maintain insurance policies for them. These agents may also represent more than one company.

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Question: What is an Independent Agent?

Answer: An independent agent represents one or more property-casualty insurers of that agent’s choosing on a commission basis, and who owns the expiration records of customers served.

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Question: What is Indirect Damage?

Answer: Indirect damage is a loss resulting as a consequence of an insured direct loss.

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Question: What is Indirect Loss?

Answer: An indirect loss is a loss that results from indirect damage.

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Question: What is an Inflation Guard Endorsement?

Answer: An inflation guard endorsement is part of a homeowners policy that increases the coverage amount at a preset time by a preset amount to offset inflation.

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Question: What is Inherent Vice?

Answer: Inherent vice is a property insurance exclusion for losses from physical property which causes deterioration or damage to that property without outside help. Typically this process is excluded from coverage by insurance policies.

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Question: What is Initial Coverage Election Period?

Answer: Initial Coverage Election Period or ICEP is an event during which an individual has the opportunity to enroll in a Medicare Advantage plan.

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Question: What is Initial Premium?

Answer: Also known as deposit premium, an initial premium is a tentative charge made at the start of certain policies that can be subsequently adjusted, at expiration or after certain information has been developed.

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Injury

Damages or harm suffered by a person or property.

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Question: What is an Injury?

Answer: An injury is an act which sustains harm, damages, or destroys a person or property.

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Question: What is Inland Marine?

Answer: Inland marine is an insurance contract for coverage of moving or movable property.

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Question: What are Inside Limits?

Answer: Inside limits are for specified types of losses which may be less than the whole policy limit. Also referred to as sub-limits.

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Question: What is an Inspection?

Answer: An inspection is a physical examination of an insured property.

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Question: What is Installation Insurance?

Answer: Installation insurance is protection for the installer of equipment against physical loss, usually on an all-risk basis in the course of installation.

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Question: What is Installment Premium?

Answer: An installment premium is the payment of a certain percentage of the total premium made overtime rather than in one payment.

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Question: What is Insurable Interest?

Answer: Insurable interest is the existence of the potential for financial loss.

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Question: What is Insurance?

Answer: Insurance is a practice by which a company provides a guarantee of compensation for specified loss, damage, illness, or death in return for payment.

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Question: What is an Insurance Agency?

Answer: An insurance agency is a business office whose function is selling insurance.

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Question: What is an Insurance Agent?

Answer: An insurance agent is the person who sells insurance by contacting a policyholder.

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Question: What is an Insurance Company?

Answer: An insurance company is an organization governed by state law that provides insurance.

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Question: What is Insurance Department?

Answer: The insurance department of the state government enforces the state’s insurance laws. Often part of an overall commerce department.

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Question: What is Insurance Fraud?

Answer: Insurance fraud is an illegal attempt to secure insurance benefits by stealing insurance premiums, selling illegal or phony coverage or submitting false claims.

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Question: What is an Insurance Policy?

Answer: An insurance policy is a written contract between the insured and the insurer detailing the coverage provided, exclusions and limitations, conditions in case of loss, and other details.

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Question: What is Insurance Trust?

Answer: Insurance trust is an asset of a life insurance policy in which proceeds are paid upon the death of the insured. Can be used to pay such expenses as estate taxes. One of many trusts.

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Question: What is Intentional Loss?

Answer: An intentional loss is caused on purpose with intent to defraud the insurer.

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Question: What is an Interest Option?

Answer: Upon the death of the life insurance policy holder, the interest option allows the beneficiary to be paid the balance or have that balance invest by the insurance company. Then, the beneficiary can receive payments over time.

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Question: What is Interest Sensitive Whole Life Insurance?

Answer: Interest sensitive whole life insurance pays interest to the insured on the cash value of the policy. The payments may vary based on the investments made by the insurer.

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Question: What is Inventory?

Answer: An inventory is a list of one’s possessions, such as a home inventory.

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Question: What is Irrevocable Beneficiary?

Answer: In a life insurance policy, an irrevocable beneficiary is a stipulation in which the beneficiary cannot be changed without written consent of the current beneficiary.

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Question: What is a Jewelry Floater

Answer: A jewelry floater protects jewelry regardless of location.

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Question: What is Joint and Several Liability?

Answer: In a joint and several liability, the damaged claimant can seek a legal remedy from all the parties involved or each party.

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Question: What is Joint Life Insurance?

Answer: Joint life insurance is a policy which makes payments after one of the insured has died. Usually held by more than one person, like married couples.

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Question: What is Joint Life and Survivor Annuity?

Answer: Joint life and survivor annuity is a policy which converts to annuity and makes payments to the insured until their death. Usually held by more than one person, like married couples.

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Question: What is Joint Life and Survivor Insurance?

Answer: Joint life and survivor insurance makes payments after one of the insureds have died. Usually held by married couples.

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Question: What is Jumbo Risk?

Answer: Jumbo risk is a policy with very high limits of insurance, either a large property line or a high limit of liability.

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Question: What is Juvenile Insurance?

Answer: Juvenile insurance is a life insurance policy for children under 16 years old.

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Question: What is a Keogh Plan?

Answer: A Keogh plan is a retirement plan for self-employed persons. The plan holder may contribute up to 20 percent of their annual net income.

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Question: What is Key Employee Insurance?

Answer: Key employee insurance is purchased by the employer for key persons. This life, health, or disability insurance serves as protection for the company should the key person die, become ill, or disabled.

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Question: What is Kidnap and Ransom Insurance?

Answer: Kidnap and ransom insurance covers the cost of a person being kidnapped. Policies may require stringent travel requirements and restrictions. Often thought to be mostly foreign, but also covers corporate risks in the United States, such as bank officer?s families.

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