An indemnity agreement is a contract that ‘holds an entity harmless’ for any future burden, loss, or damage. An indemnity agreement makes sure that a proper compensation is available for such loss or damage. Parties of an Indemnity Agreement are The Indemnitee/ indemnity holder is the one who is protected from any liability and the Indemnifier is the one who promises to reimburse the Indemnitee for any claims. Parties of an Indemnity Agreement are The Indemnitee/ indemnity holder is the one who is protected from any liabilityandthe Indemnifier is the one who promises to reimburse the Indemnitee for any claims.
Features of Indemnity Agreement:
PARTIES TO A CONTRACT: There must be two parties, namely, promisor or indemnifier and the promisee or indemnified or indemnity-holder.
PROTECTION OF LOSS: A contract of indemnity is entered into for the purpose of protecting the promisee from the loss. The loss may be caused due to the conduct of the promisor or any other person.
EXPRESS OR IMPLIED: The contract of indemnity may be express (i.e. made by words spoken or written) or implied (i.e. inferred from the conduct of the parties or circumstances of the particular case).
ESSENTIALS OF A VALID CONTRACT: A contract of indemnity is a special kind of contract. The principles of the general law of contract contained in Section 1 to 75 of the Indian Contract Act, 1872 are applicable to them. Therefore, it must possess all the essentials of a valid contract.
NUMBER OF CONTRACTS: In a contract of Indemnity, there is only one contract that is between the Indemnifier and the Indemnified.
RIGHTS OF PROMISEE/ THE INDEMNIFIED/ INDEMNITY HOLDER: As per Section 125 of the Indian Contract Act, 1872 the following rights are available to the promisee/ the indemnified/ indemnity-holder against the promisor/ indemnifier, provided he has acted within the scope of his authority.
Passport photo of all parties.
PAN card of all parties.
Aadhar card of all parties.
Utility bill of Electricity or Telephone.
Valid Address Proof of all the parties.
Valid Driving Licence of all the parties.
Terms and Conditions between the parties.
Other documents will be intimated through e-mail.
Indemnity is a form of insurance compensation for damages or loss. Indemnity is a contractual agreement between two parties. In the arrangement of indemnity, one party agrees to pay for probable losses or damages caused by another party or parties.
An indemnity agreement is a contract that 'holds a business or company harmless' for any burden, loss, or damage. An indemnity agreement also ensures proper compensation is available for such loss or damage.
Usually in contracts, an indemnification clause serves to compensate a party for harm or loss arising in connection with the other party's actions or failure to act. The reason behind it is to shift liability away from one party and on to the indemnifying party.
The process of indemnification starts when both the parties agree to compensate the other party for losses arising out of the agreement to the extent those losses are caused by the indemnifying party's breach of the contract.
The types of indemnity contract include protection or security from a financial liability. An indemnity contract usually includes a contractual agreement between two parties where one party agrees to cover any losses or damages suffered by the other party.
Indemnity is a contractual agreement between two parties, which outlines a form of insurance compensation for any damages and losses. The most common example of indemnity is an insurance contract.