May 30, 2012 Articles

Construction Anti-Indemnification Law Changes Indemnity and Additional Insurance Landscape

On January 1, 2012, Texas joined a handful of states in declaring construction contract indemnity provisions and additional insured requirements void and unenforceable

by Leslie C. Thorne

Historically, Texas has permitted indemnification provisions covering the indemnitee’s sole negligence or fault as long as the agreement was “unambiguously stated.” XL Specialty Ins. Co. v. Kiewitt Offshore Servs., Ltd., 513 F.3d 146 (5th Cir. 2008). But on January 1, 2012, Texas joined a handful of states in declaring construction contract indemnity provisions and additional insured requirements void and unenforceable if they require a person to indemnify, defend, or hold harmless another party for a claim caused by that party’s own negligence or fault. See Tex. Ins. Code § 151.102. Under the new law, owners and general contractors can, except under limited circumstances, no longer require subcontractors to indemnify them for the owner or general contractor’s own negligence or purchase insurance coverage for the owner or general contractor’s own negligence.

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