Updated: 29 February 2024

What Does Indemnitor Mean?

An indemnitor is a party who agrees to indemnify certain losses for another party. In doing so, they are legally required to compensate them when these losses are incurred.

Insurance companies assume the role of the indemnitor in insurance contracts, agreeing to compensate the insured for specific losses. The concept is also widely used in the context of surety bonds or bail bonds. When someone bails somebody out of jail, they become that person's indemnitor, which carries certain responsibilities (including ensuring that the person they bailed appears in court at the a pre-appointed date and time).

Indemnitors are often colloquially referred to as co-signers.

Insuranceopedia Explains Indemnitor

Indemnity clauses in contracts differ from the basic principle of contribution. In ordinary cases where losses, damages, or malfeasance has occurred, the responsibility and financial burden for these is divided to those who have contributed to it. So, if two parties are found to be at equal fault for faulty home renovation work that results in water damage, they will be equally responsible for compensating the affected homeowner.

Indemnity, however, places full responsibility for compensation and damages on the shoulders of the indemnitor, even if they contributed nothing whatsoever to the events that led to these damages. A contractor with liability coverage could, for example, contribute to the water damage in the scenario mentioned above, and yet only their insurance company (as the indemnitor) would be responsible for compensating the homeowner, even though the insurer did not contribute to the damage.

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