This document presents an improved K-means clustering algorithm called I-KMeans that addresses the similar distance problem. The similar distance problem occurs when multiple data points have the same minimum distance to different cluster centroids, making it unclear which cluster they should be assigned to. The I-KMeans algorithm proposes modifications to the standard K-means algorithm to handle this issue, including calculating the number of points and density of clusters to determine cluster assignment when distances are equal. The algorithm is evaluated on a banking dataset and shown to produce better clustering results than standard K-means in terms of a higher quality factor metric.