Indemnity Clause

An indemnity clause is a contractual agreement where one party agrees to compensate or protect the other from certain damages, losses, or legal claims that might arise during their relationship. Essentially, it shifts financial responsibility away from one side if something goes wrong. For example, if a contractor causes damage during a project, the indemnity clause may require the contractor to cover the costs. This clause helps allocate risk and provides assurance that one party will bear the financial burden of specific incidents, promoting trust and clarity between the parties involved.