What is the meaning of indemnity in a contract?
Indemnity is a term used in contracts to refer to the obligation of one party to protect the other against loss or harm. This type of agreement is common in business contracts and is often included as part of a liability waiver. In a contract, both parties agree to hold each other harmless for any actions taken or losses experienced as a result of the contract. The purpose of an indemnity clause is to protect a party from unexpected and undeserved liability. It makes the party agree to accept responsibility for any harm that may be inflicted on the other party due to the contract. This obligation is often used to protect against indemnity payments. Indemnity payments are payments made to the other party if they make any claims due to damages caused by the contract. Under New Jersey contract law, the parties involved in a contract must agree to provide adequate indemnity protection in order for the contract to be enforceable. This means that both parties must agree to hold each other harmless from any actions taken due to the contract, and must otherwise provide adequate protection against possible losses. Indemnity is an important provision in many business contracts, as it serves to provide assurance that each party will not suffer any losses due to the contract. This serves to protect both parties and is often beneficial for parties involved in business transactions.
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