How to Review an Indemnification Provision

Jul 19, 2022

Indemnification is a legal way to say reimbursement. We include these provisions to establish the reimbursement requirements if one of the parties is responsible for damages to the other party or its cohorts.

A lot of people get overwhelmed by indemnification provisions. They are tough to digest and read. It doesn't help that most contracts have the core elements as one very long sentence. The best way to review an indemnity is to break it down into its components and then consider each part on its own.

Here are the nine questions to ask to identify each element of an indemnification provision:

  1. Who is indemnifying?
  2. Who is being indemnified?
  3. Is there a defense obligation too?
  4. What kinds of damages are covered?
  5. What relationship is required between the damages and the events?
  6. What types of underlying events are covered?
  7. Are there any exclusions?
  8. Is indemnification the sole remedy for the event?
  9. What indemnification process is required?