The inverse finite element method (iFEM) emerged as a powerful tool in shape-sensing and structural health monitoring (SHM) applications with distinct advantages over existing methodologies. In this study, a quadrilateral inverse-plate element is formulated via a sub-parametric approach using bi-linear and non-conforming cubic Hermite basis functions for engineering structures, which can be modeled as thin plates. Numerical validation involves dense and assumed sparse sensor arrangements for in-plane, out-of-plane, and mixed general loading conditions. iFEM analysis reveals efficient monotonic convergence to analytical and high-fidelity finite element reference solutions. After successful numerical validation, defect detection analysis is performed considering minute geometric discontinuities and structural stiffness reduction because of latent subsurface defects under tensile and transverse loading conditions. The inverse formulation successfully resolves the presence of simulated defects under a sparse sensor arrangement. The proposed inverse-plate element is accurate in the full-field reconstruction of shape-sensing profiles and reliable in defect identification and quantification in thin plate structures.