Find the Hold-Harmless Clause in Your Agreement
The protection lives in a clause of the service agreement. Finding it is the first step in knowing whether it exists and what it says.
What to know.
Search the agreement and its schedules for terms such as hold harmless, indemnify, liability, limit of liability or errors. The clause may be in the main agreement or in an attached service schedule.
Read it with the definition of the covered services and the limit. Ask the provider for the page number if you cannot find it.
Where to look next.
What the Protection Covers
See the protection in plain terms.
Ask to See the Clause
See what to ask.
Which Services It Names
See the scope.
Reading the clause once you find it.
When you find the clause, read it four times for four things. First, who is promising: the legal name of the party. Second, what they are promising: to reimburse, to defend, or something narrower. Third, for what: which services and which kinds of loss. Fourth, how much and for how long: the limit and the period.
Notice also what the clause requires of you. Many clauses require notice within a set period, cooperation with the provider and documentation of the loss. These are conditions, and missing one can cost you the protection. Note them in your own calendar rather than assuming you will remember.
Common questions on this topic.
Four questions to settle before you rely on it.
What words should I search for?
Hold harmless, indemnify, limit of liability and errors are good starting points.
What if I cannot find it?
Ask the provider for the page. If there is none, there is no written protection.
Is it ever in a separate document?
Sometimes, in a schedule or addendum.
Who should read it?
The person who signs, with counsel if the amount warrants.
What if the clause is in a separate addendum?
Then the addendum is part of the agreement. Make sure it is signed or referenced in the main agreement, and keep it with the other documents.
Is a limit of liability the same as hold harmless?
No. A limit of liability usually caps what the provider owes you in general. A hold-harmless clause is a promise to reimburse for specific losses. Read both, because they interact.
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General information about compliance service protections, not legal or tax advice. Plan-specific questions belong with your counsel, and we will bring them in.
Related guides.
Is Your Compliance Vendor’s Protection in Writing?
The overview this page belongs to.
Compliance Services With Hold-Harmless Protection
What the protection is, what it covers and what to ask.
The Services a Hold-Harmless Clause Names
The next question on the same topic.
Where the Rules Come From.
The laws and rules named on this page link to the statute or regulation they come from. This is general information, not legal or tax advice, and rules change, so check the current text.
COBRA Excise Tax (26 U.S.C. 4980B)
The tax on failures to meet COBRA continuation coverage requirements.
ERISA Civil Enforcement (29 U.S.C. 1132)
Includes the daily amounts a court may assess for failing to provide required notices.
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