State Anti-Indemnity Motor Transportation Statutes Overview

January 9, 2014
Lew Bricker and Christine Anto
SmithAmundsen Transportation Alert

As 2013 comes to a close, thirty-nine (39) states have some type of anti-indemnity statute in place with respect to the transportation industry. Following in the footsteps of the construction industry, these statutes generally prohibit contractual indemnification that attempts to shift risk to one party, irrespective of fault. The statutes do not, however, prohibit provisions that serve to shift risk to a negligent party. While the intended purpose behind the statutes was originally to prevent motor carriers from bearing the liability of a shipper’s own negligence, for which they had no responsibility (i.e. improper loading), in practice the effect is much more far reaching. The impact of these statutes within the transportation industry is substantial in that it prohibits the transfer of risk when there are any claims or allegations concerning a party’s own negligence. Further, if a transportation contract provision is found to be in violation of an anti-indemnity statute, it will be held unenforceable, potentially leaving a party with no protection at all. Notably, the effect of anti-indemnity statutes can be thwarted by properly securing additional insured coverage.

With almost eighty percent (80%) of the states now enacting anti-indemnity litigation with respect to transportation, and more expected to follow, it is imperative that the impact of these laws on litigation be considered in entering transportation contracts. While the anti-indemnity motor transportation statutes are relatively similar in overall effect, they generally fall into one of four categories, depending on the statute’s language. The categories, and the particular states that fall into each category, are as follows:

  1. Alaska
  2. New Mexico
  1. Hawaii
  2. Oklahoma
  3. South Dakota
  1. California
  2. Connecticut
  3. Iowa
  4. Kansas
  5. Louisiana
  6. Massachusetts
  7. Montana
  8. Oregon
  9. Tennessee
  10. Utah
  11. Wyoming
  1. Florida
  2. Georgia
  3. Idaho
  4. Illinois
  5. Indiana
  6. Maine
  7. Maryland
  8. Michigan
  9. Minnesota
  10. Missouri
  11. Nebraska
  12. Nevada
  13. North Carolina
  14. Pennsylvania
  15. South Carolina
  16. Virginia
  17. West Virginia
  18. Wisconsin

Additionally, five (5) states, Alabama, North Dakota, Texas, Washington, and Arizona, all have idiosyncratic statutes that address motor carrier indemnification, but in a manner that does not align with other state statutes.

Finally, most state statutes include certain exceptions to the general ban on motor carrier indemnification. Please refer to each individual state’s statute summary to account for any variation from this broad summary.