indemnity

Question 1

Indemnity is compensation for damages or loss, and in the legal sense, it may also refer to an exemption from liability for damages. The concept of indemnity is based on a contractual agreement made between two parties, in which one party agrees to pay for potential losses or damages caused by the other party. A typical example is an insurance contract, whereby one party (the insurer or the indemnitor) agrees to compensate the other (the insured or the indemnitee) for any damages or losses, in return for premiums paid by the insured to the insurer.

Answer 1

Or placing the insured in the same financial position before the insured event.

Question 2

An indemnity contract arises when one individual takes on the obligation to pay for any loss or damage that has been or might be incurred by another individual. The right to indemnity and the duty to indemnify ordinarily stem from a contractual agreement, which generally protects against liability, loss, or damage.

Answer 2

indemnity an undertaking by one person to make good losses suffered by another.

Question 3

If a policy holder makes a valid claim against their car insurance policy and their car has a market value of £4300 and they have an excess of £250 how much will the insurer have to pay out to indemnify the policy holder?

£4300
£4050
£4000

Answer 3

£4050

Question 4

What type of policy pays a “benefit “ rather than “ indemnity” in the event of a claim?

Business interruption policy
Marine cargo policy
Van policy
Life assurance policy

Answer 4

Life assurance policy