Normal block formatting isn't supposed to have paragraph indentations (think emails), but book readers do expect them (except for first paragraph of each chapter as noted above). (mybookcave.com)
Most are in the italicized first paragraph of a chapter, as are some character names, but not all of them. (blog.jaynorry.com)
If you choose to follow standard print formatting, the first line of the first paragraph of every chapter will not be indented and the first few words or first clause of the sentence will be capped. (nocturnal-lives.com)