La indemnización compensó la pérdida.

Because the sentence presents the compensation as a completed action in the past.

• compensó = he/she/it compensated
• It is the 3rd person singular preterite of compensar

So the sentence is talking about one finished event: the compensation covered the loss.

If you used the imperfect instead, compensaba, it would suggest something more ongoing, habitual, or descriptive in the past, which is not the idea here.

The accent mark shows the correct stress and also helps distinguish the form.

• compenso = I compensate / I do compensate (present)
• compensó = he/she/it compensated (preterite)

In Spanish, that written accent is important because it changes both pronunciation and meaning/tense.

Spanish uses definite articles more often than English does.

Here:

• la indemnización = the compensation
• la pérdida = the loss

Even if English might sometimes say just compensation covered loss in a very compressed style, Spanish normally wants the articles with abstract nouns like these.

So this sentence sounds natural with both la forms.

Because both nouns are grammatically feminine:

• la indemnización
• la pérdida

In Spanish, nouns have grammatical gender, and the article has to agree with the noun.

A useful clue:

• Nouns ending in -ción are usually feminine: la indemnización
• pérdida is also feminine, so it takes la

This gender is grammatical; it does not mean anything biological here.

They are related, but indemnización is more specific and often more formal/legal.

• indemnización usually means compensation, damages, or a payout, especially after a loss, injury, dismissal, accident, or legal claim
• compensación is broader and can mean compensation in a more general sense

So in this sentence, indemnización suggests a payment or settlement meant to make up for the loss.

Pérdida is a noun, meaning loss.

It comes from the verb perder (to lose), but here it is not a verb form. It is the thing that was compensated.

Compare:

• perder = to lose
• pérdida = loss

So the structure is:

• La indemnización = subject
• compensó = verb
• la pérdida = direct object

The accent mark shows where the stress falls: PÉR-di-da.

Without the accent, the stress rules of Spanish would point to a different pronunciation. The written accent makes the correct stress clear.

This is common in Spanish: accent marks are often used to mark stress when a word does not follow the default stress pattern.

Because la pérdida is a thing, not a specific person.

Spanish uses the personal a mainly before human direct objects (and sometimes pets or personified beings).

Examples:

• Veo a María = I see María
• Compensó la pérdida = It compensated the loss

Since la pérdida is not a person, there is no personal a.

Yes, but the original order is the most neutral and natural:

• La indemnización compensó la pérdida.

Spanish allows more flexibility than English, but changing the order can change the emphasis.

For example:

• La pérdida la compensó la indemnización.

This is possible, but it sounds more marked and emphasizes the loss. It is not the plain, default way to say it.

Yes. It is a natural and standard combination.

Spanish often uses compensar with things like:

• una pérdida
• los daños
• los gastos
• las consecuencias

So compensó la pérdida means that the compensation made up for, offset, or covered the loss.

Yes, it sounds fairly formal and would fit especially well in:

• legal contexts
• insurance contexts
• administrative writing
• business or financial reports

That is mainly because of the noun indemnización, which is more formal and technical than everyday vocabulary.

A simple pronunciation guide:

• La → lah
• indemnización → in-dem-nee-tha-THYON in much of Spain
  or in-dem-nee-sa-SYON in seseo pronunciation
• compensó → kom-pen-SO
• la → lah
• pérdida → PER-dee-dha in much of Spain
  or PER-dee-da in seseo pronunciation

In standard Peninsular Spanish, z and soft c are often pronounced like th in think, which is why indemnización is often heard with -thión.

Not normally in this sentence.

• La indemnización compensó la pérdida sounds natural.
• Indemnización compensó pérdida sounds unnatural in standard Spanish.

Spanish usually keeps the articles with nouns like these unless you are using a very special style, such as headlines, labels, or highly compressed note-taking.

The subject is La indemnización.

You can tell because:

• it is the noun phrase doing the action
• the verb compensó is in the 3rd person singular, which matches la indemnización

So the structure is:

• Subject: la indemnización
• Verb: compensó
• Direct object: la pérdida

Yes. Depending on context, compensó can correspond to several English verbs, such as:

• compensated
• offset
• made up for
• covered

The exact English choice depends on the situation. In a financial or legal context, compensated for or covered may sound especially natural.