noun

indemnity

in-DEM-nuh-tee/ɪnˈdemnəti/

An assurance that a specified financial loss will be made good.

The homeowner's indemnity covers the loss, and the representative pays compensation for the damaged chair.

An insurance representative hands compensation money to a homeowner beside the homeowner’s visibly damaged chair, making payment for damage concrete.

Etymology

inLatinnot

+demnLatindamage, loss

+ityLatinstate or condition

The pieces express a condition of being undamaged. This became security against loss, then compensation for loss: protection beforehand or payment afterward.

In context

Tim Fairley240:36

professional indemnity insurance, which is when you're providing any sort of professional service or technical expertise, which covers any breach in duty.

The COMPLETE Guide to Construction Project Management

More examples

The supplier offers an indemnity covering the cost of defective parts.
She asks for indemnity against legal costs before signing.
The agreement includes separate indemnities for property damage and injury claims.

Forms

indemnity · indemnities

indemnify verb — To compensate someone for a specified loss.

indemnification noun — Compensation or protection against a financial loss.

Similar words

insurance: Usually provides protection through a policy purchased with premiums.
guarantee: Can promise performance or quality, not just compensation for loss.