Client Wants Us To Indemnify Them Against 3rd Party Claims Arising From "Any Negligent Act, Error Or Omission Or Willful Misconduct" - What To Do?

Good topic. Not an attorney so don't know. A few questions:

• Without this clause, would it be possible for a client to sue you anyway if the video system did not capture an incident? I am not suggesting they are right or wrong but curious if the omission of that clause would really block such an attempted suit.
• Any idea how litigious this client is generally? Do they have a cautious lawyer who just wants to be safe or do they have a history of suing others? 
• Is this a sign that the client is going to be a pain across the board and make the project unprofitable?
• What's the chance in this client's facility / location that there is going to be many serious incidents?

This is a typical clause in which it means if you get sued, you will not go after the client.  That doesn't mean that the plaintiff can't sue the client directly.  The one part I would get removed is "omissions".  If you do the job to customers specs, you don't want to be liable for the lack of camera coverage, in which a crime may have been committed.  Unlike a fire system where there's a code for everything, cameras are subjective.  Or have a different document drafted that makes them responsible for camera placement and views.

I'm not a lawyer, but I did stay at a Holiday Inn Express last night.

This contract will out last you, so I would suggest running it by your insurance agent first, since it's free and they might remind you that any agreement other than what they have approved may void your coverage.  Insurance agent requests are free and I would get in writing.

I had a celebrity lawyer try this on me once, at which point I agreed to get them listed on my insurance, specifically to their terms and would add the cost to the system installation and monitoring price.

He asked why the additional cost and I told him he was asking me to take on the insurance risk and while he most likely would be purchasing duplicate coverage, I was sure his insurance company would prefer mine pay instead, so there would be a charge.  In this case, probably tens of thousands a year.

They agreed to my terms, except I did let them modify the ability to terminate monitoring with 30 days notice instead of annually.  Sometimes on a $175,000.00 job you have to give a little bit.  No way I would alter a contract indemnity clause.

I am an integrator and the Business Manager at my Church.  If this is for action taken during the installation by your staff, I have no issues with it.  If this extends to any actions beyond the install period by others, do not sign this.  You have no idea who the Church is putting in charge of youth.  You don't know what kind of Security and Safety policies they have or don't have.  You don't even have a voice in it. This is Pandora's box.  

I have to believe this is limited to the installation itself, but it should be spelled out.  In my opinion, this is the work of a well-meaning member who thinks this is a good idea but lacks the ability to write it effectively. 

I am not a lawyer, this is not legal advice, and I make no warranties or guarantees about the applicability, appropriateness, completeness, relevance, or anything else relating to this response.  Caveat lector; caveat utilitor.  That being said . . .

This appears to be standard indemnity language intended to protect the customer (client) from being sued for negligence on the part of the service provider (integrator).  Courts would typically look at the contract in its entirety when determining any potential liability decisions.  Insurance companies may try to take a more narrow view, depending on which side of the issue they are on.

You might check to be sure the scope of the project is adequately defined in the contract, that the scope of the indemnity clause(s) is directly tied to that scope of work, and perhaps add a clause of your own that ties the indemnification strictly to the work and/or products provided.  Maybe even stipulate that the Client is solely responsible for (or that you make no guarantees or warranties related to) the use, suitability, and/or proper application of the project deliverables.

Be very careful when reviewing the scope of work.  If it says you will provide a system that will perform some specific function or task, or provide some detailed level of coverage or awareness for a specific area, you better be sure the system does just that.  If you are just installing X number of cameras in certain locations, it may be a good idea to include terms like "aimed and focused to Client requirements" and omit specifics (e.g., facial recognition at 1000 yards, crime deterrence, "situational awareness", etc.).

I would never sign anything I was not comfortable with from any perspective.  If I don't understand a clause or phrase, I make sure I do before moving forward.

My last recommendation is that if you do not have an attorney who specializes in contract law, consider hiring or retaining one for the purpose of reviewing your contracts and addressing these type issues.