A business example
A software customer asks the supplier to cover a defined third-party claim that the supplied code infringes intellectual property.
Trigger
Identify the exact type of claim covered by the clause.
Handling
Specify notice, defence control and settlement responsibilities.
Financial scope
Read limits, exclusions and any relationship with the overall liability cap.
What this shows
The word indemnity is not a complete answer. The outcome depends on the losses covered and the process the clause requires.
What it is often confused with
An indemnity is not necessarily unlimited protection; triggers, exclusions, caps and procedures matter.
What to look at in your business
Read the covered events alongside notice, defence and settlement provisions.
Context and further reading
This entry explains the business term. The related guide below provides the next layer of context; any applicable legal test depends on the transaction and relevant period.
Kosha.Services · Updated 2 October 2026