Insurance Handbook - Alaska Department of Community and ...

nel or credit agencies, fees for reapplying
for loans and attorney’s fees to defend
against lawsuits and remove criminal or
civil judgments.
IMMEDIATE ANNUITY
A product purchased with a lump sum,
usually at the time retirement begins or
afterwards. Payments begin within about
a year. Immediate annuities can be either
fixed or variable.
*INCOME DATE
The date on which an insurer begins or is
scheduled to begin making annuity benefit
payments under an annuity contract. Also
known as maturity date and annuity date.
*INCOME PROTECTION INSURANCE
A type of disability income coverage that
provides an income benefit both, while the
insured is totally disabled and unable to
work and while he is able to work, but because
of a disability, is earning less than he
earned before being disabled. Also known
as residual disability insurance.
*INCONTESTABILITY PROVISION
An insurance and annuity policy provision
that limits the time within which an
insurer has the right to avoid the contract
on the ground of material misrepresentation
in the application for the policy.
Also known as incontestable clause. (See
Contestable period; Time limit on certain
defenses provision)
*INCREASING TERM
LIFE INSURANCE
A type of term life insurance that provides
a death benefit that increases by some
specified amount or percentage at stated
intervals over the policy term. Contrast with
Decreasing term life insurance.
Glossary
INCURRED BUT NOT
REPORTED LOSSES/IBNR
Losses that are not filed with the insurer
or reinsurer until years after the policy is
sold. Some liability claims may be filed
long after the event that caused the injury
to occur. Asbestos-related diseases, for example,
do not show up until decades after
the exposure. IBNR also refers to estimates
made about claims already reported but
where the full extent of the injury is not
yet known, such as a workers compensation
claim where the degree to which workrelated
injuries prevents a worker from
earning what he or she earned before the
injury unfolds over time. Insurance companies
regularly adjust reserves for such losses
as new information becomes available.
INCURRED LOSSES
Losses occurring within a fixed period,
whether or not adjusted or paid during the
same period.
INDEMNIFY
Provide financial compensation for losses.
INDEPENDENT AGENT
Agent who is self-employed, is paid on
commission, and represents several insurance
companies. (See Captive agent)
*INDETERMINATE PREMIUM
LIFE INSURANCE POLICY
A type of nonparticipating whole life policy
that specifies two premium rates—both a
maximum guaranteed rate and a lower rate.
The insurer charges the lower premium rate
when the policy is purchased and guarantees
that rate for at least a stated period of
time, after which the insurer uses its actual
mortality, interest, and expense experience
to establish a new premium rate that may
be higher or lower than the previous premium
rate. Also known as nonguaranteed
I.I.I. Insurance Handbook www.iii.org/insurancehandbook 101