Hold harmless agreements are standard legal forms utilized in most personal, professional, and business environments. Renting property, hiring a contractor, attending an event, or running a business are all circumstances where you may be asked to sign, or encounter, one of these agreements.
But what is actually a hold harmless agreement? Who is it safeguarding? And are they always enforceable?
In this article, we’re going to analyze the purpose, forms, applications, limitations, and enforceability of hold harmless agreements, providing you with the knowledge you need to know your rights and obligations before signing or creating one.
What Is a Hold Harmless Agreement?
A hold harmless agreement is a legal contract in which one party agrees not to hold another party liable for any loss, damage, or legal liability that may arise from a particular activity or transaction.
In essence, it’s a promise to assume responsibility for certain risks and to waive the right to sue the other party if something goes wrong.
Hold harmless clauses are typically found in:
- Construction contracts
- Lease agreements
- Event participation waivers
- Service provider contracts
- Business partnerships
- Recreational activity releases
These agreements are often used to shift liability and protect individuals or companies from lawsuits related to injury, property damage, or financial loss.
Key Elements of a Hold Harmless Agreement
While wording can vary, most valid hold harmless agreements contain several common elements:
- Identification of the Parties – Names and roles of the person or entity assuming risk and the one being protected.
- Description of the Activity or Service – Clear explanation of the situation the agreement covers.
- Risk Assumption Clause – A statement that the signer is aware of the risks involved and accepts them.
- Indemnification Clause – Often included to require one party to cover the legal fees or damages of the other party.
- Jurisdiction and Governing Law – Specifies which state’s laws apply if a dispute arises.
Types of Hold Harmless Agreements
There are generally three types of hold harmless agreements, categorized by the level of liability protection provided:
1. Broad Form Hold Harmless
The broadest level of protection, this type shields one party from all liability, including claims that result from the indemnitee’s own negligence. These are often disfavored by courts and may not be enforceable in every state due to their sweeping scope.
Example: A contractor agrees to hold a property owner harmless from all claims—even if the property owner’s negligence contributes to an injury.
2. Intermediate Form Hold Harmless
This type of agreement protects the indemnitee from liability, except when the indemnitee is solely responsible for the harm. It covers shared fault situations.
Example: A business vendor agrees to hold a venue harmless for any injuries caused during a promotional event, unless the venue was entirely at fault.
3. Limited Form Hold Harmless
The most restricted version, this type only requires the indemnifying party to accept liability for their own actions. They don’t shield the other party from any responsibility.
Example: A personal trainer includes a clause in their client agreement stating that the client assumes all risk from the workout and won’t hold the trainer liable for injuries caused by the client’s own actions.
Common Uses of Hold Harmless Agreements
Hold harmless agreements are used across industries and activities to limit liability and allocate risk. Common scenarios include:
Construction and Contracting
General contractors often require subcontractors to sign hold harmless agreements to protect themselves from any accidents, damage, or legal issues caused by the subcontractor’s work.
Property Rentals
Landlords may include hold harmless clauses in lease agreements to avoid being held responsible for injuries or property damage experienced by tenants or their guests.
Event Participation
Waivers for sports, races, and other high-risk activities typically include hold harmless language to protect organizers from lawsuits if a participant is injured.
Business Agreements
Companies may use these agreements when hiring outside vendors or service providers to prevent legal exposure if the third party causes damage or injury while performing work.
Volunteer Activities
Nonprofits or community organizations may ask volunteers to sign agreements that release them from liability in case someone gets hurt during an event or service project.
Are Hold Harmless Agreements Enforceable?
Whether a hold harmless agreement is enforceable depends on a few factors:
1. State Laws
Some states limit or prohibit the use of broad form hold harmless clauses, especially when they attempt to excuse a party from their own negligence. For example, California generally prohibits contracts that indemnify a party for willful misconduct or gross negligence.
2. Clarity and Specificity
To be enforceable, the language in the agreement must be clear, specific, and unambiguous. Vague or confusing language may cause a court to throw out the clause.
3. Fairness and Public Policy
Courts may refuse to enforce a hold harmless agreement if it is deemed unfair or against public policy. This could happen if the signer was under duress, lacked bargaining power, or if the clause attempts to excuse intentional wrongdoing.
4. Voluntary Signing
The agreement must be signed voluntarily by a party who had the opportunity to review and understand the terms. Hidden or non-negotiable clauses may not hold up in court.
Limitations of Hold Harmless Agreements
While hold harmless agreements offer a layer of protection, they are not foolproof. Some limitations include:
- They do not prevent lawsuits – Even with an agreement in place, someone can still file a lawsuit. The clause may be used as a defense, but it doesn’t stop litigation from occurring.
- They don’t protect against gross negligence or intentional harm – Most courts will not enforce an agreement that attempts to release a party from reckless or malicious conduct.
- They may not cover third-party claims – Some agreements only cover disputes between the two signing parties and do not extend to claims made by outside individuals.
Tips for Drafting or Reviewing a Hold Harmless Agreement
Whether you’re preparing an agreement or being asked to sign one, consider these best practices:
If You’re Drafting One:
- Be specific about what activities or risks are covered
- Use clear and readable language
- Include indemnity and insurance requirements if appropriate
- State the jurisdiction and applicable law
- Have the agreement reviewed by an attorney
If You’re Signing One:
- Read the entire document carefully
- Understand the risks you’re assuming
- Look for overly broad or vague clauses
- Don’t sign under pressure—ask questions
- Consider consulting a lawyer before agreeing
When to Contact a Lawyer
You should speak with an attorney if:
- You were injured and a hold harmless agreement is being used against your claim
- You’re unsure whether an agreement you signed is enforceable
- You need to draft an agreement for your business or event
- You’re entering a contract involving significant risk or liability
Legal professionals can help clarify your rights, negotiate fair terms, and determine if the agreement will hold up in court.
About the Author
Neil Bhartia
Neil Bhartia isn’t your typical, stuffy attorney that you see on TV. While some have their sights exclusively on money and treat their clients like a number, Neil takes a personal interest in every single client he has. As an empath, Neil understands that people that seek legal help are typically in an involuntary, and stressful situation, and he goes out of his way to diffuse the stress and educate clients on each every detail of the legal process.
