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Indemnification Training Hub
Learn the essentials of indemnification provisions, their meaning, why they are important, and practical strategies for commercial contracts.
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Our indemnification courses offer a practical real-world approach to drafting and negotiating indemnification clauses in business contracts. We cover defend and hold harmless, scope of losses and claims, covered claims and exclusions, indemnification process, and sole remedies.
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Download our free negotiation scripts for indemnification clauses
Laura Frederick created this negotiation script to share typical arguments that each party make during indemnification negotiations. She reviews both sides' assertions involving defend and hold harmless, scope of indemnified parties, and more.
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Or download our free indemnification clause checklist
This indemnification provision checklist outlines the critical language, concepts, and strategies for drafting and negotiating indemnification provisions.
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Watch these indemnification training videos
"How Vendors Can Argue Against Uncapped Indemnities"
In this video, Laura Frederick discusses negotiating strategies vendors can use when arguing against uncapped indemnities. Laura walks through some different approaches and then gets real about how vendors can manage their risk when accepting unlimited liability for indemnification is the only option.
"Liability Cap + Negligence + Indemnity = BE CAREFUL!!!"
Check out these indemnification tips and cartoons from Laura's book
Indemnification Provision Basics
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 representatives. 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. I've found the best way to review an indemnity is to break it down into its components and then consider each part on its own. READ MORE
Nexus in Indemnification Provisions
Nexus is the law's way of saying a connection. In contracts, we use nexus to identify how closely related two things have to be to create an obligation. With indemnification, we ask how closely connected the act by the indemnifying party (such as its negligence) has to be with the damage suffered by a third party making a claim against the indemnified party. If there is no nexus, there is no indemnification obligation. Our nexus wording acts as a lever. If you want to narrow the scope (as many indemnifying parties prefer to do), use narrower nexus words. READ MORE
Put All the Contract's Indemnities in One Section
Some contracts litter indemnities throughout the document. They add indemnity obligations next to random contract obligations and warranties.I don't like this approach. I prefer to keep all the indemnities in one section. Here's why. Most indemnification provisions include more than just the basic obligation to indemnify. They provide details about covered claims, exclusions, procedures, and mitigation. If there are random indemnity provisions in other places, are they subject to these terms too? It usually is unclear. READ MORE
Notice of Claim Language in Indemnification Provisions
The claim notice language in an indemnification provision is the start and kicks off the indemnification process. The indemnified party notifies the indemnifying party about a covered claim. If the indemnifying party controls the defense, it takes over at this point. There are two ways to approach the notice language. 1. Covenant (favors the indemnified party) One option is to write the notice provision as a covenant. It's a simple obligation like most other provisions. If the indemnified party does not provide the required notice, it is a breach. But that breach may not be material and may be subject to cure. READ MORE
Defining the Indemnified Parties in a Contract
The indemnifying party often has the right and obligation to defend against covered claims. When I was a newer attorney, I thought of defense as only an obligation and an unfair one at that. "You mean my client has to pay hundreds of thousands of dollars to defend a lawsuit to which it isn't even named and with no finding of fault? What?" When my client was the indemnifying party, I drafted to get them out of it. I'd add limits that only required my client to reimburse for the defense costs only after a finding of my client's fault. What I've learned over the years is that the indemnifying party in many situations wants to defend the action. It is a right to defend, not just an obligation. READ MORE
Territorial Restrictions on IP Indemnities
Pay attention to the territorial restrictions in the intellectual property indemnification obligation. Intellectual property indemnities identify the types of claims covered. If a claim falls out of scope, the indemnifying party doesn't have to do anything about the claim. If you are the indemnifying party, you prefer wording to shift more claims out of the indemnification scope.
One way to do that for an IP indemnity is to limit the claims to only those related to a particular jurisdiction. The party more likely to do the indemnifying – typically the vendor – will want it narrow: “Seller will indemnify…claims that the Product or use of it infringes a U.S. patent or copyright issued as of the Effective Date.” READ MORE
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