An agreement hold harmless clause, also known as an indemnity clause, is a term in a contract that aims to protect one party from potential losses or damages caused by the other party’s actions. This clause is intended to shift the risk of loss from one party to another in the event of an unforeseen circumstance that results in financial or legal liability.

In essence, the agreement hold harmless clause is a legal tool that allows parties to allocate risk when entering into a business arrangement. It is commonly used in contracts for services, construction, and real estate to protect parties involved in the transaction from liabilities that may arise due to the actions of others.

There are two types of agreement hold harmless clauses – the broad form and the limited form. The broad form hold harmless clause provides protection to the indemnitee against any and all claims arising from the conduct of the indemnitor. On the other hand, the limited form hold harmless clause is more specific and only covers claims arising from certain circumstances or events.

The agreement hold harmless clause is often used in situations where one party has more bargaining power than the other. For example, a construction company may require a hold harmless clause in a contract with a homeowner to protect against any lawsuits that may arise due to the construction work.

It is important to note that the agreement hold harmless clause may not always be enforceable in court, especially if it violates public policy or is deemed unconscionable. In some cases, courts may interpret the clause as being too broad or unfair to one party.

To ensure that the agreement hold harmless clause is valid and enforceable, it is important to have an experienced attorney review and negotiate the contract language. Additionally, parties should also seek the advice of insurance professionals to ensure that they have adequate coverage to protect against potential losses.

In conclusion, the agreement hold harmless clause is a valuable legal tool for businesses and individuals to manage risk in transactions. However, it is crucial to exercise caution when including this clause in a contract and to seek expert advice to ensure that it is enforceable and fair to all parties involved.