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Insurance

Accounts receivable (debtors) insurance

In finance, the concept of indemnification refers to the compensation or protection provided to an individual or entity for any losses incurred due to unforeseen circumstances or events. For instance, in the case of open commercial account debtors, if records are destroyed by an insured peril, the indemnification clause ensures that the entity is compensated for any losses incurred due to the inability to collect from these debtors. This provides a safety net for businesses and helps to mitigate potential financial risks.
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