Glossary of Insurance Terms
Incidents of Ownership: Various rights that may be exercised under the policy contract by the policy owner. Some of the incidents of ownership may include rights: (1) to cash-in the policy, (2) to receive a loan on the cash value of the policy, and (3) to change the beneficiary designation.
Incontestability Clause: A life insurance policy provision that states after the policy has been in force for a specified period of time, the company cannot deny a claim based on a material misrepresentation made in the application. The typical period of time for the clause is two years.
Inspection Report: A report sometimes required by an Insurance company in conjunction with the underwriting of an application for coverage. The report typically includes information pertaining to the applicant's occupation, health history and financial status. The report is usually completed by the Insurance company or an investigative agency.
Insurability: General acceptability by an insurance company of an applicant for insurance based on underwriting review, which may include items such as the applicant's current health status, medical history and driving record among others.
Insurable Interest: The existence of potential financial loss on the part of the policy owner and/or beneficiary(s) in the event of the death of the insured. The policy owner and any beneficiaries must have an insurable interest.
Insurance: A system for reducing risk by transferring the risks of several individual entities to one entity, such as an insurance company. Each individual entity contributes monetarily (premiums) to cover the risk assumed by the Insurance company.
Insurance Company: A company that provides insurance coverage through the issuance of insurance policies. This is also referred to as the Insurer.
Insurance Department: An area within each state's government that administers and regulates the insurance industry within the state.
Insurance Policy: The physical, written document issued by an insurance company to the policy owner. The insurance policy represents the written contract between the insurance company and the policy owner.
Insured: The individual covered by an insurance policy.
Irrevocable Beneficiary: A type of beneficiary designation that cannot be changed without the written consent of the beneficiary.
Irrevocable Trust: A trust that cannot be revoked or amended by the party who establishes it. This type of trust is often established when life insurance is purchased to protect an estate.
Issue Date: The actual date an insurance policy is issued. This may also be the effective date of the policy.
I.D. Card/Identification Card: A card issued to a covered person of a health insurance plan. The card is typically presented by the insured to heath care providers when seeking services.
Indemnity Plan: A type of traditional health Insurance In which the covered person is reimbursed for covered expenses without regard to choice of provider. Also known as fee-for service plans.
In-Network: Refers to the use of providers who participate in the health plan's provider network. Many benefit plans encourage enrollees to use participating (in-network) providers to reduce the enrollee's out-of-pocket expense.
Inpatient Services: Services rendered to a person who is admitted to a hospital for medical care, is assigned a bed designated for routine, special, psychiatric, or rehabilitation care, and occupies the bed for 24 hours or more.