Indemnity Law and Legal Definition
Indemnity means compensation in money or property for a loss suffered. It also means a contract to save another from the legal consequences of the conduct of one of the parties or of a third person. It is an agreement whereby one party agrees to secure another against an anticipated loss or damage.
Indemnity is a right which insures to a person who, without active fault on his/her own part, has been compelled, by reason of some legal obligation, to pay damages occasioned by the initial negligence of another, and for which s/he himself is only secondarily liable. [Builders Supply Co. v. McCabe, 366 Pa. 322 (Pa. 1951)]