letter of indemnity definition

letter of indemnity

Written undertaking by a third party (such as a bank or insurance company), on behalf of one of the parties (the first party) to a transaction or contract, to cover the other party (the second party) against specific loss or damage arising out the action (or a failure to act) of the first party. Also called indemnity bond.

letter of indemnity is in the Agreements & Contracts, Banking, Commerce & Finance and General, Marine, & Life Insurance subjects.

letter of indemnity appears in the definitions of the following terms: bond of indemnity, shipper's indemnity, back letter, indemnity and bank guaranty

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