Quick Definition

Indemnity insurance is a type of insurance policy that compensates the insured for losses or damages up to a certain limit, providing financial protection against claims or legal actions.

Examples

• 1A doctor purchasing professional indemnity insurance to cover legal costs and settlements if sued by a patient for malpractice.
• 2A contractor obtaining indemnity insurance to protect against claims of property damage or injuries caused at a construction site.
• 3A business owner using indemnity insurance to cover the costs associated with data breaches, including compensation for affected customers.

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