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Difference between Contract of Indemnity and Guarantee
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Difference between Contract of Indemnity and Guarantee
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Difference Between Contract of Indemnity and Contractof Guarantee
A contingency contract recognized under contract law is an indemnity and guarantee contract. In
other words, indemnification refers to a monetary reward that protects against loss. When one party
guarantees to make restitution for a loss brought on by the other party's or another party's acts, the
commitment is known as indemnity.
On the other side, the guarantee is when one party promises to fulfill the promise or the duty of the
other party if the other party fails to do so.
Most consumers select an indemnity or guarantee contract to safeguard their rights while engaging in
a deal. At first look, these two could seem to be the same, yet they differ in several ways. Discover
more about the distinctions between guarantee and indemnity.
, Contract of Indemnity
A contract of indemnity is a contingent contract in which one party agrees to pay the other for any
losses or damages caused due to the first party's or another party's activities. Two parties are
involved in the contract: the indemnifier, who agrees to cover the other party's losses, and the
indemnified, who receives compensation. The following are subject to recovery by the indemnity
holder from the indemnifier.
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