Indemnity

Indemnity is a legal principle that requires one party to compensate another for certain damages or losses incurred. It is often used to allocate risk between parties in contracts and can involve reimbursement for expenses or liabilities.

The concept of indemnity has its roots in Roman law, where it was used to outline the obligations of parties in contractual relationships. Over time, it evolved to become a critical part of various legal contracts and insurance policies.

In modern law, indemnity clauses are frequently included in contracts to protect one party from financial loss due to the actions of another. Such provisions are common in areas such as construction contracts, employee agreements, and insurance policies.

• A contractor agrees to indemnify a property owner against claims arising from the contractor's work on the property.
• An insurance company provides indemnity to its policyholder for losses incurred due to an accident covered by the insurance policy.

• Crawford v. McKenzie, 1891