indemnify

Indemnify is a legal concept referring to an obligation by one party to compensate another for losses, damages, or liabilities arising from specified events or third-party claims. In contract practice, an indemnity shifts risk by requiring the indemnitor to reimburse the indemnitee for costs and damages or to defend against claims. Indemnity obligations may be satisfied out of pocket or through insurance arrangements.

Indemnity clauses commonly cover third-party claims arising from the indemnitor’s acts or omissions, products, or contractual duties, and may include defense costs, settlements, judgments, and related expenses. They specify the scope of risk, exclusions such as willful misconduct or gross negligence, notice obligations, and control of defense. They may require the indemnitor to procure insurance or to name the indemnitee as an additional insured, as well as rules on subrogation and recovery of amounts paid.

Types and limits: Express indemnity is written into a contract; implied indemnity may arise from the relationship, statute, or the law of a jurisdiction. Limitations such as liability caps, carve-outs for certain risks, and public policy constraints are common. Some jurisdictions restrict indemnification for the indemnified party’s own negligence or for certain professional services.

Relation to insurance: indemnity is separate from insurance, but insured losses may be paid by an insurer; parties may use subrogation to recover amounts paid.

Drafting considerations: define trigger events, specify the scope of obligations, clarify defense control and settlements, set notice requirements, address insurance and additional insured status, and consider liability caps and exclusions.