Parties to a construction or design contract can define their duties toward one another, in the event a third-party claim arising out of the working relationship is brought against one or both. In many cases, the terms of this type of agreement will require one party to indemnify the other, for money paid or expenses incurred, as a result of such claims. They may also assign one party, pursuant to the contract’s language, to be held responsible for the other’s legal defense when a third-party claim is made against the latter. Cases interpreting construction contracts are also used as support for indemnity claims between other parties to contracts, including contracts between insurance professionals.
Read the full article at the California Insurance WHolesaler’s Association Website