Law · Indian Contract Act 1872 - Indemnity
According to prevailing judicial interpretations in India regarding a contract of indemnity, when can the indemnity holder legally compel the indemnifier to pay if the specific loss has not yet occurred?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1As soon as the indemnity holder's liability to a third party has become absolute and certain, even if no payment has been made.✓
- 2Exactly 3 years from the date of the execution of the indemnity bond under the Limitation Act.
- 3Only when the indemnifier explicitly consents in writing after the liability arises.
- 4Only after the indemnity holder has actually paid the amount and suffered the cash outflow.
Correct answer
As soon as the indemnity holder's liability to a third party has become absolute and certain, even if no payment has been made.
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