Glossary

The language of insurance can be quite complex and confusing. Below are some commonly used insurance terms and their meanings. Insurance professionals with whom you may come into contact should be prepared to explain these terms. If you don't understand, ask!

This information is for educational purposes only and should not be relied upon to form professional opinions on coverage issues.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

I

IBAC*

See Insurance Brokers Association of Canada.

IBC*

See Insurance Bureau of Canada.

ICBC*

See Insurance Corporation of British Columbia.

ICLR*

See Institute for Catastrophic Loss Reduction.

Immobilizer*

An electronic anti-theft device that arms a vehicle automatically when it is switched off, and prevents unauthorized starting of the vehicle. (See also Canadian Standard for Automobile Theft Deterrent Systems)

Improvements and Betterments

Additions or changes to a rented premises by a tenant at his own expense. Also called Tenant's Improvements.

Incendiary

Malicious setting on fire or preparing, providing and setting the means for fire to start.

Inception

The date and time on which coverage under an insurance policy takes effect.

Incident*

An event which, under different circumstances, could have resulted in harm to people, damage to property or equipment, or loss of process or productivity – for example, almost hitting a pedestrian with a car, or a slip and fall that does not result in an injury. Sometimes an incident is referred to as a “near miss.”

 

Indemnify*

To compensate the insured person for a loss, in whole or in part, by payment, repair, or replacement.

Indemnitor

Party entering into indemnity agreement with a second party, securing second party against loss.

Indemnity

A contract, express or implied, to repay in the event of a loss. Insured neither gains nor loses.

Indirect or Consequential Loss (or Damage)*

Loss resulting from a peril, but not caused directly or immediately by the peril. For example, loss of property due to fire is a direct loss, while the loss of rental income as the result of the fire would be an indirect loss.

In Force

Insurance policy which is in effect, and has not expired or been cancelled.

Informed consent*

An agreement intended to ensure that both parties understand the activities being undertaken and the risks associated with them. Often used in conjunction with a waiver or hold-harmless and indemnifying agreement.

Inherent Explosion

An explosion caused by the normal processes of a risk as opposed to one caused by external causes, e.g., a dust explosion in a grain elevator.

Inherent Vice

The quality that something has to deteriorate or damage itself without outside help, e.g., milk sours; coal combusts spontaneously.

Inland Marine Insurance

Coverage for movable property in transit, excluding ocean crossing; includes bridges and tunnels, because they are implements of transportation.

Inspection*

Independent checking of facts about an applicant or claimant, usually by a commercial inspection agency.

Inspector

An insurance company employee who examines physical risks and reports on them for underwriting purposes. In some companies this is done by the Special Agent or Field Representative.

Institute for Catastrophic Loss Reduction (ICLR)*

The insurance industry established the Institute for Catastrophic Loss Reduction (ICLR) in 1998. It is a coordinated effort of the Canadian home, car and business insurance community, the University of Western Ontario and other partners to reduce – through research and education – the loss of life and property caused by severe weather and earthquakes. ICLR is working to improve Canadians’ capacity to adapt to, anticipate, withstand and recover from natural disasters.

Insurable Interest

An interest which the insured must have in the subject matter of the insurance he buys so that if the event insured against occurs, the insured will suffer a pecuniary loss.

Insurance*

A contract between an insurance company and its customer for a specific period of time. It protects the customer financially against a loss. Insurance is also a mechanism for dispersing risk, because it shares the losses of the few among the many.

Insurance Brokers Association of Canada (IBAC)*

As the national voice of 25,000 home, car and business insurance brokers in Canada, IBAC represents their interests to the government of Canada. IBAC develops national licensing courses and professional development programs for brokers, for delivery through its 11 provincial/regional associations.

Insurance Bureau of Canada (IBC)*

The national trade association for the companies that insure the homes, cars and businesses of Canadians. IBC’s membership includes the companies that provide nearly 95% of the home, car and business insurance sold in Canada. IBC works on behalf of member companies to advocate for public policies that create and maintain a healthy insurance marketplace that serves insurers and consumers. IBC facilitates communications and seeks consensus among its members and, when possible, seeks out and implements solutions to common insurance concerns.

Insurance Corporation of British Columbia (ICBC)*

The government-run insurance company from whom all drivers in British Columbia must purchase mandatory or compulsory car insurance.

Insurance Institute of Canada (I.I.C.)*

The professional education arm of the general insurance industry in Canada.

Insurance Policy

A written contract of insurance.

Insured

The entity (individual or otherwise) whose risk of financial loss from an insured peril is protected by the insurance policy.

Insurer

The company providing the insurance coverage.

Insuring Clause

Describes the intent of the policy, just what insurance coverage is provided by the policy and in what limits.

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