Contractual liability is any liability or responsibility for loss which is assumed by the University under a contract which would normally not be the responsibility of the University had the contract not existed. Certain contractual liability clauses demanded by external parties may be in conflict with our insurance program structure and/or allowance by WI State Statutes. Such transfers of liability most often come in the form of and indemnity, hold harmless, and limits of liability requests.
WI State Statutes prohibit the University from signing any contracts which contain promises of indemnification for losses that the University is not responsible for. This posture is necessary because the State, as a representative body of its tax-paying public, cannot make promises against, or be held responsible for, future unknown debts. Hold harmless and limits of liability must be scrutinized in their impact on the campus. Therefore, any time a contract is used which contains contractual language that is not within the scope of State Statutes, or places campus in unnecessarily adverse position, attempts must be made to negotiate the conflicting language out of the contract or add allowable compromise language that meets our requirements (See UWSA’s Hold Harmless and Indemnity Agreements page for further details). If unsuccessful in properly adjusting the conflicting language, contractual liability insurance may be required to cover the exposure.