Indemnification Agreement Template

Indemnification Agreement Template

What Is an Indemnification Agreement?

An Indemnification Agreement is a legal contract between two parties that holds one party responsible for the damage or loss suffered by the other party and specifies compensation that will be available for the negative occurrences.

Alternate Name:

  • Indemnity Agreement.

A general Indemnity Agreement is commonly used under the following circumstances:

  1. Construction industry. Before a contractor is officially hired, a construction company makes them sign this document to protect themselves against a lawsuit in case of the contractor's injury.
  2. Rental car business. Drivers must sign this contract before they drive their car for the first time - this protects the organization in case the driver and their passengers are injured in the accident.
  3. Real estate rentals. When composing a lease agreement, a landlord can request their tenant to include an indemnity clause in this document or create a separate Indemnity Agreement to protect themselves from damages and losses caused to the rental property during the tenant's stay.
  4. Businesses that offer dangerous services and risky activities to their customers, for instance, skydiving or extreme skiing.
  5. Pet kennels. The owner of the pet may be asked to sign this document to make sure the kennel owner or administrator is not liable for damages the pet caused to other pets in the kennel.

If you are looking for a printable Indemnity Agreement template, you can download it below{class="scroll_to"} or compose a more personalized document with the help of our online form builder.


What Is the Purpose of an Indemnity Agreement? {id="mcetoc_1ec2poqf40"}

An Indemnity Agreement allows the injured party (indemnitee) to claim compensation or reimbursement for the losses they suffered from the party that is liable to make up for these damages (the indemnifier). Once you agree to indemnify someone in writing, you confirm that you are ready to take responsibility for the losses and injuries listed in the agreement. This contract only extends to the person or entity that signed the agreement, their representatives who act on their behalf, and people under their control - subordinates and employees.

Sometimes, this document is confused with a similar form - a Hold Harmless Agreement. These names and concepts are often used interchangeably, and the contract is even called a "Hold Harmless and Indemnity Agreement". However, the former document has a broader coverage - it also protects the non-breaching party from liabilities. It is recommended to draft both documents to cover all possible incidents.

How to Make an indemnity Agreement? {id="mcetoc_1ec2poqf41"}

Follow these steps to draft an Indemnification Agreement Form:

  1. Identify the parties to the agreement by their names (business names) and addresses. Add contact information of the parties.
  2. Indicate the purpose of the document and determine the scope of indemnity. Negotiate a compromise with the other party and find a middle ground that will satisfy both of you.
  3. List instances that will trigger the indemnity. If the scope you have defined only provides for particular instances in which the other party will have to indemnify you, state all of them.
  4. Mention liability insurance - experienced companies from various industries choose to buy liability insurance to cover negligent actions, omissions, and errors.
  5. Negotiate the limit of damages. You can include the maximum amount of damages for which the indemnifying party will bear responsibility.
  6. State the amount of consideration (usually, it is a sum of money) that secures your contract.
  7. Disclose all the risk for which the indemnifying party may become liable - this ensures both parties they are equally informed about the agreement they are signing.
  8. Include exclusions to the contract. Typically, if the damage was caused by the indemnitee's fault or negligence, there will be no indemnification.
  9. Sign the document. In some cases, only the party that indemnifies the other can sign the agreement, however, it is recommended to obtain two signatures so that everybody is on the same page. You can appear in front of a notary public to add an extra level of protection to your contract.

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