What term describes a clause that limits or excludes liability for breach of contract or negligence?

The term that describes a clause that limits or excludes liability for breach of contract or negligence is known as an exclusion clause. This type of clause is commonly included in contracts to allocate risk between the parties. By incorporating an exclusion clause, a party can specify the circumstances under which they will not be held liable for certain damages or breaches, typically aiming to protect themselves from unforeseen liabilities that may arise during the execution of a contract.

In legal contexts, exclusion clauses are subject to scrutiny and must often meet specific legal standards to be enforceable. These standards may include the requirement that the clause be reasonably clear, conspicuous, and agreed upon by both parties.

Other terms mentioned relate to different concepts in contracts. An indemnity clause is designed to protect one party from loss or damage by allowing them to recover costs from another party under specific circumstances. An exemptions clause generally refers to similar limitations but is not as commonly used in legal terminology as exclusion clause. Lastly, a liability clause could pertain to outlining the extent of liability in a contract generally, rather than specifically limiting or excluding it. Hence, the exclusion clause specifically and clearly captures the intent of limiting or excluding liability within a contract.