HB409 Alabama 2020 Session

Summary

Primary Sponsor

Steve McMillan

Republican

Session

Regular Session 2020

Title

Highway, roads, and bridges, contracts or subcontracts for public works, provisions requiring a party to indemnify another party for damages caused by the other party prohibited

Summary

HB409 would ban indemnification clauses in highway/public works contracts that require one party to cover damages caused by another party's conduct.

What This Bill Does

If passed, the bill would prevent private parties from making a contract for roads or bridges require one side to indemnify or defend the other for damages caused by that side's own negligence or misconduct. Any such post-enactment contract term would be void, and indemnity would be allowed only to the extent the damages come from the indemnifying party's own fault. It also limits insurance provisions by prohibiting certain types of additional insured arrangements and clarifies exceptions for surety and insurer obligations. The act applies only to private contracts between private parties on road/bridge projects funded with public money and does not change third-party tort claims or obligations to the Department of Transportation or other awarding entities, with immediate effect upon governor approval.

Who It Affects

• Contractors and subcontractors involved in public works projects for roads and bridges; they would no longer be able to push liability for others' damages onto another party through indemnity, and post-enactment contracts with such terms would be void.
• Insurers and insureds who might be affected by limits on additional insured status and the scope of indemnity, as well as the handling of surety bonds and insurer obligations (which are carved out from the act).

Key Provisions

• Prohibits requiring indemnification, hold harmless, or defense for liability caused by the negligence, wantonness, recklessness, or intentional misconduct of the indemnified party or its agents.
• Defines 'public works contract for roads and bridges' as a contract or subcontract for planning, building, repairing, or improving roads or bridges funded by public funds.
• Any such indemnity provision in contracts entered after the act's effective date is void.
• Allows indemnity only to the extent damages are caused by the negligence, wantonness, recklessness, or intentional conduct of the indemnifying party or its agents.
• May not require additional insured status for claims arising from the other party's own conduct beyond the indemnity scope; coverage cannot be broader than the indemnity allowed under the act.
• Excludes indemnity related to surety on construction bonds and insurer obligations to insureds from the act.
• Applied only to private party indemnity contracts between private parties on road/bridge projects; does not affect third-party tort claims or obligations to the Department of Transportation or other awarding entities.
• Becomes effective immediately after passage and governor approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Highways, Roads, and Bridges