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CIPS L5M3 Exam - Topic 3 Question 65 Discussion

What is the name given to a term in a contract where one party promises to compensate the other party for a trigger event?
D) indemnity
A) liability
B) warranty
C) damages

CIPS L5M3 Exam - Topic 3 Question 65 Discussion

Actual exam question for CIPS's L5M3 exam
Question #: 65
Topic #: 3
[All L5M3 Questions]

What is the name given to a term in a contract where one party promises to compensate the other party for a trigger event?

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Suggested Answer: D

Indemnity- this is the definition given on p. 20


by Alaine at May 05, 2026, 03:39 AM

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Ceola
4 days ago
I think it's D) indemnity. Sounds right.
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Elza
9 days ago
Good luck to everyone!
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Gail
14 days ago
That makes sense. I feel more confident now.
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Fabiola
19 days ago
Exactly! Indemnity is the promise to cover losses.
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Elza
25 days ago
Warranty is more about quality, not compensation.
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Gail
30 days ago
I was torn between B) warranty and D) indemnity.
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Fabiola
1 month ago
Agreed! Indemnity covers compensation.
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Elza
1 month ago
I think it's D) indemnity. Sounds right.
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Hyman
2 months ago
Surprised to see so many people getting this right!
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Steffanie
2 months ago
I thought it was damages, but I guess I was wrong.
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Lili
2 months ago
Wait, isn't that just liability?
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Eulah
2 months ago
Definitely indemnity, no doubt about it.
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Genevieve
2 months ago
It's called indemnity!
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Raul
2 months ago
I’m pretty confident it’s "indemnity." We had a similar practice question where that was the correct answer, right?
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Thaddeus
4 months ago
I’m torn between "damages" and "indemnity." I feel like both could apply, but I can't recall the exact definitions we went over.
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Alonzo
4 months ago
I remember practicing a question about this! "Indemnity" was definitely mentioned, but I also feel like "warranty" could be relevant in some contexts.
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Lezlie
4 months ago
I think the term we're looking for is "indemnity," but I'm not completely sure. It sounds familiar from our contract law discussions.
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