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Series 63: Remedies & Administrative Provisions
Series 63 practice questionmediumContribution vs. Indemnification

Which of the following best distinguishes contribution from indemnification under the USA?

  1. AContribution allows partial recovery from other liable parties; indemnification involves full reimbursement✓ Correct answer
  2. BBoth allow full recovery from other liable parties
  3. CIndemnification is required under the USA; contribution is not
  4. DContribution is only available if the Administrator approves
Explanation

Why AContribution allows partial recovery from other liable parties; indemnification involves full reimbursement

Contribution is where each liable party pays their share, while indemnification involves one party reimbursing another for the full amount paid. The USA recognizes contribution, not mandatory indemnification.

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