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In this tutorial, Michele explains the term "indemnification," commonly encountered in contracts, settlements, or business separations. Indemnification refers to the act of covering someone's back by taking responsibility for claims made against them related to a specific circumstance or product. It is essential to clearly outline what is being indemnified against, which may include various risks associated with a transaction or agreement. The concept ensures that one party provides protection to another against potential liabilities arising from their actions or products.