What Is An Indemnity And Why You Need One

An indemnity is on the one hand a safeguard to protect a supplier this could include the entire supply chain e.g. guesthouses, adventure activities, guides, tour operators, transporters, etc. from liability that may arising from the provision of goods or services.

It may, however, also refer to the converse: an undertaking such as insurance by one party the insurer/indemnitor to reimburse the other the insured/indemnitee for liability through a cash payment, replacement, reinstatement, or repair.

Such liability can include one or more of the following: losses, claims, damage, loss, injury, illness, death or more mundane issues such as cancelled bookings and the safeguard can be to exclude, minimise or reimburse claims or liability as stipulated in the indemnity.

It may also include more serious aspects such as consequential, financial or economic loss of damage however the cause may have arisen.

Indemnities may also be referred to by other names, such as hold/save harmless agreement, waiver of liability, release of/from liability, or no-fault agreement .? Clearly, the use of this wording in addition to the word indemnity illustrates the nature of the document i.e. where the supplier is protected against liability as opposed to insurance where the insurance company indemnifies the client i.e. incurs liability and undertakes by and large to place the client/insured in a position they would have been had it not been for the insured incident/event.