The Accumulative Iterative Code (AIC) proposed in this work is a new error correcting code for channels with feedback. AIC sends the information message to the receiver in a number of transmissions, where the initial transmission contains the uncoded message and each subsequent transmission informs the receiver about the locations of the errors that corrupted the previous transmission. Error locations are determined based on the forward channel output, which is made available to the transmitter through the feedback channel. AIC achieves arbitrarily low error rates, thereby being suitablefor applications demanding extremely high reliability. In the same time, AIC achieves spectral efficiencies very close to the channel capacity in a wide range of signal-to-noise ratios even for transmission of short information messages.