Indemnity

An indemnity is a collateral contract or assurance, by which one person engages to secure another against an anticipated loss, or to prevent him from being damnified by the legal consequences of an act or forbearance on the part of one of the parties or of some third person. Thus, insurance is a contract of indemnity. So an indemnifying bond is given to a sheriff who fears to proceed under an execution where the property is claimed by a stranger. The term is also used to denote a compensation given to make the person whole from a loss already sustained; as where the government gives indemnity for private property taken by it for public use. A legislative act, assuring a general dispensation from punishment or exemption from prosecution to persons involved in offenses, omissions of official duty, or acts in excess of authority, is called an indemnity; strictly it is an act of indemnity.