IndemnityIndemnity Clauses in Business Contracts: What Are You Actually Agreeing To?
An indemnity clause is a promise to bear specified losses or liabilities if a defined event occurs. In practical terms, when your business gives an indemnity, it may be agreeing to pay another party’s damages, legal costs, settlements and other covered losses—sometimes even before that party has actually paid the underlying claim. Under Indian law, the consequences depend heavily on the exact wording. An indemnity that looks like boilerplate can create liability far greater than the value of the contract itself.
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