"Indemnity" - a contractual obligation to repay all costs and expenses incurred as a result of a particular breach of contract. "Indemnification" - can be the same as as "indemnity" or the process of indemnifying. "Compensation" - money paid to a victim of injury or loss in order to put him or her back into the same position that they were in before the injury or loss "insurance" - if you pay money to an insurance company for an insurance policy, you have insurance. If any of the specified risks in the insurance policy materialise and you suffer losses or cause losses to others, then the insurance company may indemnify or compensate you and/or others affected.