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Indemnity is defined by statute in California as a contract by which one engages to save another from a legal consequence of the conduct of one of the parties, or of some other person.[1] In other words, one party (known as the indemnitor) agrees to be responsible for certain liabilities of another party (known as
What is the purpose of indemnity agreement?
Indemnity agreements, also known as indemnity clauses, play an integral role in contracts. Thats because they are designed to punish the nonperforming party and reassure the damaged one they will be reimbursed for losses caused by the errant entity.
What is the most common form of indemnity agreement?
The most common forms of indemnity agreements are broad form indemnity agreements, intermediate type indemnity agreements, and comparative form indemnity agreements. The usage of these agreements depends on the industry.
What is indemnify in real estate?
To indemnify means that the seller will reimburse the buyer for a loss or liability. To defend means that the seller will pay the buyers legal fees for suits that arise from specific risks articulated in the contract.
Why is indemnification important?
The primary benefit of an indemnification provision is to protect the indemnified party against losses from third party claims related to the contract. Indemnification provisions are generally heavily negotiated (and often heavily litigated) clauses.
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People also ask
What is a corporate indemnity agreement?
An indemnity agreement is a contract that protects one party of a transaction from the risks or liabilities created by the other party of the transaction. Hold harmless agreement, no-fault agreement, release of liability, or waiver of liability are other terms for an indemnity agreement.
What is the most common form of indemnity agreement?
The most common forms of indemnity agreements are broad form indemnity agreements, intermediate type indemnity agreements, and comparative form indemnity agreements. The usage of these agreements depends on the industry.
What is an example of indemnity?
The most common example of indemnity in the financial sense is an insurance contract. For instance, in the case of home insurance, homeowners pay insurance to an insurance company in return for the homeowners being indemnified if the worst were to happen.
What is the purpose of an indemnification agreement?
Indemnification, also referred to as indemnity, is an undertaking by one party (the indemnifying party) to compensate the other party (the indemnified party) for certain costs and expenses, typically stemming from third-party claims.
What is the most common form of indemnity agreement?
The most common forms of indemnity agreements are broad form indemnity agreements, intermediate type indemnity agreements, and comparative form indemnity agreements. The usage of these agreements depends on the industry.
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