Contractual liability insurance responds when a contract creates legal liability that would otherwise be outside an entity’s standard policy promises.
The policy covers contractual indemnification obligations, provided the liability is explicitly insurable and not excluded.
Underwriting
Insurers review contracts for high-risk indemnity language, caps, and indemnification breadth before binding the policy.
Claims logic
Claims departments separate pure negligence exposure from contractually assumed exposure before applying policy exclusions and limits.