This is the clause family creators understand least and fear most, and for good reason. Get it wrong and a single deal could expose you to costs far larger than the fee.
Indemnity means promising to cover the other side's losses in defined situations. Liability clauses set the ceiling on what you could owe. Written fairly, they share risk sensibly. Written one-sidedly, which is common, they load it all onto you.
The clauses to watch on liability
- Uncapped liability, no ceiling on what you could be required to pay. The most important one to fix: your exposure should never be unlimited for a fixed fee.
- Creator indemnity obligation, you agree to cover the brand's losses. Reasonable in narrow, defined circumstances; dangerous when broad.
- Broad indemnity scope, open-ended triggers that make you responsible for far more than your own actions.
- Brand indemnity absent (one-way), the brand does not offer the same protection back to you, for example over the materials or briefs they provide.
- Consequential / indirect / punitive damages, extends what you could owe beyond direct losses into knock-on damages that are hard to predict or bound.
How to protect yourself
- Cap your liability. Tie the maximum to the fees paid under the agreement. This is standard and the single most valuable edit.
- Make indemnity mutual. If you indemnify them, they should indemnify you, especially for content, claims or materials they supply.
- Exclude consequential damages. Limit your exposure to direct losses and carve out indirect and punitive damages.
- Narrow the triggers. Your indemnity should cover your own breaches and your own content, not the brand's decisions.
Quick questions
What is a normal liability cap? Capping liability at the total fees paid under the contract is a common, defensible position for a creator.
Should I ever accept indemnity? A narrow, mutual indemnity tied to your own actions is normal. Be very cautious with broad, one-way indemnities and uncapped exposure.
This is the area where a few words can dwarf the value of the whole deal. If you negotiate only one thing, make it a liability cap.