Navigating Indemnification: Understanding Contract Language and Insurance Obligations

Contracts often require indemnification, where one party compensates another party for first-party losses or claims made by third parties. This post explores several considerations for obtaining intended indemnification. Understanding contract language is one of the first steps important to ensure both parties know what indemnification is being provided. Among other things, the checklist should consider whether indemnification applies to third-party claims, first-party losses, or both, what events or conduct trigger the indemnification obligation, and whether there’s a duty of defense. In addition, if insurance coverage is involved, different layers of liability coverage could lead to potential conflicts and the obligation of assets to be navigated. Finally, many states have notice and formal tender registration requirements that should not be overlooked. Read More>>>Navigating the Choppy Waters of Indemnification - Lexology