indemnity
/ɪnˈdɛmnɪti/A legal agreement or clause that compensates for losses, damages, or liabilities incurred by a party.
The contract includes an indemnity clause to protect against third-party claims.
The contract has a clause that ensures compensation if third parties make claims.
Common in insurance, contracts, and legal agreements.
The act of compensating someone for harm or loss, often through insurance or legal means.
The company sought indemnity from the supplier for defective products.
The company asked the supplier to compensate them for faulty products.
Used in financial and business contexts.
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💡Pro Tip
Legal Context
Indemnity often appears in contracts to outline compensation terms.
⚡Gold Rule
Contractual Use
Indemnity clauses must clearly define the scope of compensation.
📖Word Origin
From Latin 'indemnitas', meaning 'freedom from damage' or 'compensation'.
📝Usage Notes
Primarily used in legal and financial contexts to describe compensation agreements.