Inter have denied any contact with Madrid over a possible deal for Icardi, who has hit 16 goals in 15 league games to fire Luciano Spalletti's team to the top of Serie A.
Madrid have been struggling in front of goal this season, having allowed Alvaro Morata to join Chelsea, while Cristiano Ronaldo has only hit the net twice in La Liga.
Karim Benzema, meanwhile, has faced criticism over his form and was embroiled in a spat with Gary Lineker regarding his performances, although Kovacic defended the striker despite appearing to tout Icardi for a move to Madrid.
"I have played with [Icardi], he is a very good player who scores many goals," Kovacic said on Tuesday.
"But we have the best forward in the world, which is Karim.
"Icardi is good and could help us for sure, but I don't talk about signings."