1. Contracts
A contract is an agreement between two or more parties which creates an obligation to do or not to do a particular thing.
The document containing such an agreement is usually in writing, although a contract can be oral.

2. Contractual Risk Transfer
Contractual risk transfer is a non-insurance contract/agreement between two parties
One agrees to indemnify and hold another party harmless for specified actions, inactions, injuries or damages.
This risk transfer accomplishes objectives found in both risk financing (finding a source to pay the cost of a claim) and risk control (developing a means to avoid or lessen the cost of a loss).

3. Contractual Risk Transfer
The ideal use and true purpose of contractual risk transfer is to place the financial burden of a loss on the party best able to control or prevent the incident leading to injury or damage.
Presumably, the entity(ies) directly and actively participating in the activity have the best opportunity to prevent or avoid the loss; thus they are contractually required to protect an “innocent” supervising or non-participating party from financial harm following injury or damage.

4. Contractual Risk Transfer
Contractual risk transfer is the process by which an organization assigns risk to others who it chooses to do business with.
Contractual risk transfer can allocate risk to others through hold harmless provisions and insurance specifications.
Liability may fall upon the owner of a contract absent appropriate language.
The potential loss stemming from performance of contracts could be too large to assume.

5. Contractual Transfer Concerns
There are a number of potential concerns which may arise with respect to contracts or contractor insurance unless appropriate indemnity provisions and insurance specifications are established:
Contractor purchases the wrong type of insurance.
Contractor fails to specifically name the entity as an additional insured under its insurance policy.
Contractor's insurance lapses and the contractor is rendered insolvent.
Contractor's employees are injured and have no insurance.
Inadequate contractor insurance limits.
 Insurance policy exclusions.
Contractor's insurance company becomes insolvent.

6. Hold Harmless Agreement
A hold harmless clause is a statement in a legal contract stating that an individual or organization is not liable for any injuries or damages caused to the individual signing the contract.
An entity may ask an individual (Or organization) to sign a hold harmless agreement when the individual (Or organization) is undertaking an activity that involves risk for which the enabling entity does not want to be legally or financially responsible.

7. Hold Harmless Agreement
A hold harmless clause is not always an absolute protection against lawsuit or liability.
Some states do not honor hold harmless agreements that are nebulous in language or overly broad in scope.
Moreover, if one party presents a strong case that an entity coerced or beguiled him into signing a hold harmless clause against his will, the clause can be deemed null and void.
In some states, the use of home harmless clauses is prohibited for certain types of activities.

8. Types of Hold Harmless Agreements
The type of hold harmless/indemnification clause obtained by each state agency will depend on negotiating abilities, skill in writing contracts, and the bargaining position of the parties.
 Three classifications are:
Limited Form
Intermediate Form
Broad Form

9. Limited Form Hold Harmless
Requires the party to be responsible for his/her own negligence.
Under a limited form hold harmless/indemnification agreement, the party agrees to hold harmless, defend, and indemnify the agency for liability arising out of the negligent acts or activities of the contractor.
Requires the party to be responsible for his/her own negligence or the joint negligence of the contractor and the state.
The party agrees to hold harmless, defend, and indemnify the agency for all liability arising out of the project, except that arising out of the sole negligence of the organization.

10. Broad Form Hold Harmless
Requires the contractor to be responsible for all liability arising out of the project (including the sole negligence of the agency).
 Under a broad form agreement, the contractor agrees to hold harmless, defend, and indemnify the agency for all liability arising out of the project.
The clause does not guarantee the following:
That the contract itself is good, or that the courts will enforce the clause if it is against public policy.
That the party who assumes the liability will be financially able to pay damages or respond.
That the insurer of the assuming party will cover loss due to exclusions under the contractual liability coverage.

11. Indemnification Agreement
‘Indemnify' means:
One person (or entity) indemnifies another person (or entity), the first person (indemnifier) promises to reimburse the second person (indemnitee) for any claim or damages that the indemnitee may suffer while participating in a designated activity

12. What is an Indemnitee?
The indemnitee is the person requiring protection against any claim or damages that the indemnitee may suffer while participating in the activity.

13. What is an Indemnifier?
The indemnifier is the person who promises to reimburse the indemnitee for any claim or damages that the indemnitee may suffer while participating in the activity.

14. ‘Jointly and severally liable’
Joint and several liability means that where there is more than one indemnifier, then all indemnifiers will be liable for any amounts owed.
In addition, if one indemnifer is unable to pay their portion of the amount owed, the remaining indemnifiers will be liable for the unresolved amount.

15. Certificates of Insurance
The certificate of insurance provides evidence of contractor insurance and should indicate the type of coverage, limits of liability, and term of insurance.
A certificate should be signed by an authorized agent of the insurer or an officer of the insurance company.

16. Certificates of Insurance
A certificate of insurance is not a contract--only evidence of coverage at the time the certificate is issued. Having a certificate is no guarantee that the policy is currently in force or that coverage is as requested.

17. How to evaluate a certificate of insurance
Obtain a certificate directly from the insurance agent or a third-party provider.
Check the insurer’s reputation. 
Validate coverages and amounts. 
Verify that the policy is current. 
Check for exclusions, limitations and additional coverage types. 
Additional insureds

18. Additional Insured
“Additional insured” usually refers to a person or entity added to the policy by an “endorsement.”
Endorsements typically provide coverage to the people/businesses named on them only for claims arising out of the acts or omissions of the primary insureds.