Which term describes a contractual agreement where one party agrees to hold the other party harmless from liability?

Which term describes a contractual agreement where one party agrees to hold the other party harmless from liability?

• A. Hold-harmless
• B. Release
• C. Waiver
• D. Indemnity

Answer: (A)

The main idea is risk transfer through a hold-harmless clause. This kind of contract provision asks one party to protect the other from claims or liability that could arise during the activity. In practice, the party agreeing to hold the other harmless takes on the responsibility to defend and pay for losses, damages, or claims that might be brought against the protected party, keeping them free from liability for those risks. A release would terminate a claim already on the table, not create ongoing protection. A waiver is giving up a right to sue, not establishing a continuing shield. Indemnity involves compensating someone for losses after they occur; while hold-harmless language is often paired with indemnity, the phrase describes the protective stance—shielding the other party from liability—more directly.

The main idea is risk transfer through a hold-harmless clause. This kind of contract provision asks one party to protect the other from claims or liability that could arise during the activity. In practice, the party agreeing to hold the other harmless takes on the responsibility to defend and pay for losses, damages, or claims that might be brought against the protected party, keeping them free from liability for those risks.

A release would terminate a claim already on the table, not create ongoing protection. A waiver is giving up a right to sue, not establishing a continuing shield. Indemnity involves compensating someone for losses after they occur; while hold-harmless language is often paired with indemnity, the phrase describes the protective stance—shielding the other party from liability—more directly.