Indemnification clause: definition, example, and why it matters
Common in commercial contracts. A sub indemnifies the GC against claims arising from the sub's work; the GC indemnifies the owner against claims from the GC's work. Read carefully — broad indemnification can bankrupt a small contractor.
Short definition. A contract term shifting financial responsibility for certain risks to the other party.
Category. Indemnification clause is a legal term used by service businesses when billing customers.
How Glo Invoice handles it. Glo Invoice builds indemnification clause into the invoice itself, so you don't track it on paper or in a spreadsheet.
Frequently asked questions
What does indemnification clause mean?
Common in commercial contracts. A sub indemnifies the GC against claims arising from the sub's work; the GC indemnifies the owner against claims from the GC's work. Read carefully — broad indemnification can bankrupt a small contractor.
Related terms
Service contract — A written agreement defining the work, price, and terms between two parties.
General liability insurance — Insurance covering claims for bodily injury and property damage you cause to others.
