Question 1

What is a subcontractor indemnity agreement?

Accepted Answer

A subcontractor indemnity agreement is contract language — usually a clause within the subcontract, not always a separate document — where the subcontractor agrees to cover the general contractor's losses, legal costs, and liability arising from the subcontractor's work. It's a risk-transfer tool: it shifts financial responsibility for certain claims from the GC to the sub.

Question 2

What are the risks of signing an indemnity agreement?

Accepted Answer

The biggest risk is signing broad form indemnity language without understanding what it covers — some broad form clauses make a subcontractor responsible even for losses caused by the general contractor's own negligence, not just the subcontractor's own mistakes. Other risks include indemnity language that isn't backed by adequate insurance (meaning the sub would have to pay out of pocket), and clauses that conflict with your state's anti-indemnity statute, which can make part of the clause unenforceable anyway.

Question 3

Do indemnity clauses survive contract termination?

Accepted Answer

In most well-drafted construction contracts, yes — indemnity clauses are typically written with "survival" language specifically so the obligation continues after the contract ends or is terminated, since claims (like a jobsite injury) often surface well after work is complete. Whether a specific clause survives depends on its exact wording and applicable state law, which is why contract-specific language should always be reviewed by a construction attorney.

Question 4

What is an example of an indemnity agreement?

Accepted Answer

A common example: "Subcontractor shall indemnify, defend, and hold harmless Contractor from and against any claims, damages, losses, and expenses arising out of or resulting from performance of the Work, to the extent caused by the negligent acts or omissions of Subcontractor." That's intermediate form language — it limits the subcontractor's obligation to losses actually caused by the subcontractor. See our sample indemnity language guide for annotated examples of each indemnity form.

Question 5

What are the three types of indemnity?

Accepted Answer

Broad form (the subcontractor indemnifies the GC for all losses connected to the work, including losses caused by the GC's own negligence), intermediate form (the subcontractor indemnifies the GC only to the extent the loss was caused by the subcontractor, even in a shared-fault situation), and limited form (the subcontractor is responsible only for losses caused solely by its own negligence). See our types of indemnity clauses guide for a full breakdown.

Question 6

What are the disadvantages of indemnity for a subcontractor?

Accepted Answer

Broad and even some intermediate form indemnity clauses can expose a subcontractor to financial responsibility well beyond what its own insurance is designed to cover, particularly if the clause isn't matched to an adequate insurance program. Many states have passed anti-indemnity statutes specifically because broad form indemnity was seen as shifting too much risk onto smaller subcontractors who often have less leverage to negotiate contract terms.

Question 7

How is additional insured status different from an indemnity agreement?

Accepted Answer

An indemnity agreement is a contractual promise — a subcontractor agreeing on paper to cover certain losses. Additional insured status is an actual insurance mechanism: the general contractor is added as an additional insured on the subcontractor's liability policy, so the GC has direct access to that policy's coverage and defense obligations, not just a promise to pay. The two work together — indemnity language states the intent, additional insured status helps fund it.

Question 8

What should a general contractor require from a subcontractor's insurance program?

Accepted Answer

At minimum: adequate general liability limits matched to the project's risk, additional insured status naming the GC (and often the owner), a waiver of subrogation, primary and noncontributory language, and workers' compensation coverage. See our subcontractor insurance requirements guide for the full breakdown.

Question 9

Why does certificate of insurance tracking matter if the contract language is solid?

Accepted Answer

Because a certificate of insurance is a snapshot in time — coverage can lapse, get cancelled, or renew with different (often lesser) terms without anyone updating the GC. Airtight indemnity and additional insured language is only as good as the coverage actually in force when a claim happens. A real tracking process catches expired certificates, missing endorsements, and limit changes before they become a problem.

Question 10

Is sample indemnity language on this site something I can just use in my contracts?

Accepted Answer

No — the sample language on this site is educational, meant to show how each indemnity form is typically structured in plain English. It is not legal advice and should not be copied directly into a contract. Indemnity language is state-law-dependent and contract-specific; have a licensed construction attorney draft or review the actual language in your subcontract.

Question 11

Does every state allow broad form indemnity?

Accepted Answer

No. A number of states have passed anti-indemnity statutes that limit or outright ban broad form indemnity in construction contracts, on the theory that it shifts too much risk onto subcontractors. Because these laws vary significantly by state and change over time, confirm current law with a licensed construction attorney rather than relying on contract language alone.

Question 12

How do I get help reviewing my subcontract's risk-transfer language and insurance program together?

Accepted Answer

Request a risk-transfer review. A licensed CCA agent will look at how your current indemnity language, additional insured requirements, and certificate tracking process fit together — and flag any gaps. This is a coverage and process review, not a substitute for legal review of your actual contract language.

Frequently Asked Questions About Subcontractor Indemnity Agreements

Ready for a Second Set of Eyes on Your Risk-Transfer Program?