Plain-English glossary
Indemnity
A clause requiring one party to cover legal claims, losses, or costs for another party.
Why it matters
Indemnity can be fair when tied to your misconduct, but risky when broad enough to shift large legal costs.
Words to watch for
indemnifydefendhold harmlessthird-party claims
In layman's terms
You agree to cover the company legal costs if someone sues them because of something you did. This could mean paying for their lawyers even if you did not do anything wrong.
Plain-English example
If your actions create a claim against the company, you may have to pay their costs.
Related:Liability cap