An Indemnity Agreement is also known as a:
- Hold Harmless Agreement
- Indemnification Agreement
What is an Indemnity Agreement?
An Indemnity Agreement is a document that removes liability from one party in a business relationship.
Who are the Parties in an Indemnity Agreement?
There are two main parties in an Indemnity Agreement, but there can be more than one of each.
Indemnitee. The indemnitee, which may be either an individual or a corporation, is the party that requires protection. This means that they are the party whose liability will be removed with the agreement.
You may only have multiple indemnitees if they are acting together, such as a husband and wife.
Indemnifier. An indemnifier in a hold harmless agreement, which may also be an individual or corporation, is the party who is providing protection. This means that they are removing liability from the indemnitee.
When there are two or more indemnifiers they are held jointly liable for any claims.
For example, if a business was holding a community event on private property, the owners of the property would not want to be held responsible for any injuries, accidents, or other claims in relation to the event. That would make the property owner the indemnitee, and the company running the event the indemnifier.
Essentially, the company would agree to take responsibility for any injuries or harm that arose during the event on private property as opposed to the property owners.
Indemnification Details in an Indemnity Agreement
In your Indemnity Agreement, you will need to choose the category that best suits the category of indemnity being agreed to. Your options include:
Activity: General indemnity for activities, like an event or activities relating to an event, such as a concert or festival.
Contract: Indemnity pertaining directly to provisions within an existing contract.
Lease: Indemnity that relates specifically to a lease.
Transaction: Indemnity that relates directly to a purchase or sale.
It is also recommended that you provide a detailed description of what the indemnification is for, how long it will last, and who is involved.
Terms in an Indemnity Agreement
You may choose any of the following terms to include in your Indemnity Agreement:
Indemnity insurance. You may require that the indemnifier (the party offering protection) purchase indemnity insurance to cover any future liabilities.
Indemnification against criminal proceedings.
Confidentiality clause. A clause that ensures no private information in relation to the contract or the indemnification is shared with outside parties.
Monetary limit. You may set a maximum amount for the indemnification.