In short
An indemnity is a promise by one side to cover the other side's losses if a particular event happens, such as a claim by a third party.
What it means for you
An indemnity moves a risk from one side to the other. Depending on the wording, it can reach further than an ordinary claim for breach of contract, and it may sit outside the cap on liability.
Where to find it
In a clause usually called Indemnities, near the clauses on liability. Check whether the limitation of liability clause leaves it outside the cap.
What to look for
- Which events it covers
- Whether it is capped, or sits outside the cap
- Whether it covers losses caused by the side that benefits
- What you must do to claim, such as giving notice in time
How Gathersense helps
Contract review flags indemnities that reach further than your playbook allows or sit outside the cap, and ties each finding to its clause.
