The exclusions refer to the claims that will not be covered under the indemnity and are often the most negotiated part of indemnity provisions.
The effect of an exclusion is that if an Indemnified Event occurs, the Indemnified Party cannot claim under the indemnity.
Examples of typical exclusions are if the Customer modifies the supplied product somehow or the Client uses the product beyond specification/documentation.
These Exclusions must be worded carefully and must usually provide that the exclusion only applies to the extent that the exclusion relates to the claim.