Intellectual Property Insurance: Introduction & Guide

intellectual property insurance, uk
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In the corporate world, Intellectual Property is the seed that can blossom into an entire business empire. As such, companies will do everything they can to protect their Intellectual Property from the prying eyes of competitors. In this article, we will talk about how to get intellectual property insurance in the UK.

Intellectual Property Insurance

A system of economic relationships that protects intellectual property subjects’ important assets in the event of a covered event is called intellectual Property insurance. It is delivered by the monetary funds that insurers build up from paying insurance premiums. IP insurance has a lot of benefits for a business.

  • One of them is to stop unfair competition from “big” companies and help level the playing field. This is one way.
  • Another big benefit of IP insurance is that it gives the person who owns the IP more power when they try to get money or use the IP as collateral.
  • Also, the availability of intellectual property insurance can speed up innovation and research and development efforts. Coverage of existing or potential IP assets can help owners and investors focus on driving the business strategy of the relevant company for long-term growth, profitability, and market leadership.

Forms of IP Insurance

There are a lot of different types of intellectual property insurance that people and businesses can look into as a way to protect themselves or their businesses from being sued. These are:

#1. Commercial General Liability (CGL) Insurance

A general policy like this one tries to cover many things, including IP. Advertisement injury: Most CGL Insurance often covers “advertising injury,” which protects the IP rights of people who have been hurt by the ads. Because this type of insurance doesn’t cover a lot of different types of intellectual property (trade secrets, patents, and so on), it can be hard to use. It also doesn’t cover a lot of different types of IP.

#2. Offensive insurance/Enforcement Coverage

This is another type of insurance that is meant to help with misappropriation by paying for the high costs that come with enforcing IP rights. This insurance is called “offensive insurance” or “enforcement coverage.”

11 This type of insurance is for when someone steals or tries to steal IP rights. According to the policy, the insured can either pay for the action and then file a claim, or the insurer will pay for a professional to fight for their rights when there is a cause of action.

#3. Defensive Insurance/Liability Coverage

People who buy this kind of insurance can use it as a defense if they get to answer the authority. Known as “defense cost and damages reimbursement” insurance, it lets policyholders fight back against a complainant, pay for research to re-examine the policyholder’s IP rights, and pay for any damages that a complainant wins against them. 12 In the event that a court rules that a company violated another person’s intellectual property rights, this type of insurance can help the company avoid a big hit to its finances or profits.

#4. Directors and Officials’ Coverage

Insurance for directors and other people who work for a company is another type of coverage. Most of the time, the people who are being sued for enforcement or infringement are the same people who are also being sued.

To make sure that the officials (most of those in charge of things or who handle the IP) are covered, they need to have a policy called “officials’ coverage.” This type of insurance is likely to be useful as defensive insurance or liability coverage if the company and its leaders are found to have been negligent.

As we’ve already said, the biggest risk with IP is that someone else will use it without permission. According to, there are also some risks with IP, like: 

  • There are some agreements with third parties for things like development or commercial use of their IP. 
  • The activities of the business make things for people to read. 
  • Using open-source software. 
  • Being a part of some interoperability standardization activities. 
  • Getting involved with some open innovation projects. 
  • When subcontractors are hired to do work for you. 

A company should be careful when it comes to protecting its IP. 

IP insurance pays for the costs of going after someone who steals or infringes on their intellectual property. If a policyholder is charged with copyright infringement or theft, it also pays for its legal fees. In general, there are two main types of IP insurance: 

  • Infringement Defense: A lot of people buy IP insurance to protect against infringement. It protects policyholders from claims that they broke the law. 
  • Abatement enforcement coverage: This coverage gives people who own intellectual property (the insureds) the money they need to fight for their rights and file infringement claims.

How to manage the financial impact of IP risk

Managing IP litigation risk is all about being ready. As a group, they have a good idea of what their IP is. This means that they are ready for anything. As soon as they have that figured out, it’s important for businesses, if possible, to register that IP in order to own it. This way, they can show that they made it. Protecting IP that has been registered with a patent, copyright, or trademark is a lot easier than protecting IP that hasn’t been registered with these things. 

Written agreements can also be used by businesses to protect their intellectual property even more. Contracts for jobs, non-disclosure agreements, non-competitive agreements, and licensing agreements are some of the written agreements that people make. Making sure to keep a paper trail and remember who was involved in that paper trail is very important.

What counts as intellectual property?

Intellectual property is something that you make with your mind, like a story, an invention, an artwork, or a symbol.

#1. Owning intellectual property

When you own your own intellectual property, If you do this:

  • It was made (and it meets the requirements for copyright, a patent or a design)
  • bought intellectual property rights from the creator or someone who owned them before that.
  • The brand could be a trademark, such as the name of a well-known item.

Intellectual property can

  • have more than one owner
  • belong to people or businesses
  • be sold or transferred

People who own intellectual property have rights that let them make money from their own ideas and from the ideas of other people.

Intellectual property if you’re self-employed

If you work for yourself, you usually own intellectual property, even if your work was hired by someone else. Unless your contract with them gives them the rights, you usually own it.

As a general rule, you will not own the intellectual property of something you made as part of your job while working for someone else.

Intellectual Property Insurance UK

These rights to insurance are called intellectual property in the UK. They involve copyright, designs, patents, trademarks, circuit layouts, plant varieties, and confidential information. They are called “industrial property” and “intellectual property.”

How do I make a claim?

Talk about the possible infringement with your own lawyer/IP attorney as soon as you can. Because there could be a fight, make sure your insurance company knows about it and that you’re thinking about how to deal with it, You won’t be able to get back any money you spend before you tell the intellectual property insurance company in the UK or get their permission.

How do I get IP insurance coverage?

As with other types of business insurance, you should talk to an expert broker who can help you figure out what kind of insurance you need. People usually go through this process in about 10 days.

  • You fill out an application form
  • It’s the broker’s job to figure out what kind of insurance is best for each customer.
  • Getting quotes from one or more insurance partners is what the broker does.
  • You and the broker talk about the quotes and what they mean for your business.
  • You have to decide which policy is best for your business.

This usually includes figuring out how likely it is that you will get into a fight. This assessment will not be shared with you, and it could mean that you won’t be covered.

Is IP insurance expensive?

People who get insurance will use certain things to figure out how much they’ll be charged for their service. IP LEI has these:

  • how much and what kind of insurance do you need to protect yourself?
  • IP rights that you want to protect
  • the field in which you work
  • The area in which you are protected.

For small and medium-sized businesses, the IP Enterprise Court (IPEC) is a less expensive and less complicated way to fight over intellectual property than in the general Chancery Division of the High Court.

How can I learn more about the IP I may own and how to protect it?

Almost every business has intellectual property (IP) insurance in the UK. It could be your most important thing. As with other business assets, you can get insurance to protect against the risks that come with your IP. However, you can also make sure you don’t inadvertently violate the rights of other people by taking steps to protect yourself.

To figure out if your business should buy IP insurance, you first need to know, understand, and, if necessary, protect your IP.

Free online tools are available from the Intellectual Property Office (IPO) to help you learn more about trademarks, design patents, and copyright. You can use these tools to learn more about them.

Before the event, legal expenses insurance (LEI) policies can help you pay for your own legal fees and the legal fees of someone with whom you are in dispute. LEI policies can also help pay for someone else’s legal fees.

There is a problem, though. BTE LEI doesn’t cover risk after a claim has been made or before the possibility of a claim has been or should have been known about. As long as the alleged infringement hasn’t happened yet, you can only get BTE coverage. As soon as possible, you should think about whether or not to get BTE insurance.

What types of Intellectual Property Insurance products are available in the UK?

Insurance products can cover one or more rights, as well as a wide range of IP risks, like:

  1. Opinion Only: pays for the legal costs of getting an opinion on the chances of successfully enforcing or defending an IP claim (see also IPO patent and proposed designs opinions)
  2. Enforcement and Defense: Enforcement and defence, however, pay for the legal costs of your taking action to stop others from infringing your IP rights and defending against claims of infringement. Can cover both enforcement and defence, either alone or together.
  3. Damages: This covers any damages you might have to pay if you lose an infringement case.
  4. Validity: This pays for the costs of defending your rights against legal challenges to their validity.

Other products you might want to look into:

  1. Lost Revenue: This covers the money you lost when you lost your IP rights.
  2. Indemnity: protects you from claims that arise from promises you make to other people.
  3. Cyber: covers losses from a wide range of cyber incidents, such as IPR breaches.

In many ways, IP legal expenses insurance works just like other types of insurance, like health insurance or life insurance. In a business where the technology is complicated or the market is very competitive, there may be more risks.

When you’re getting IP insurance, you should also expect there to be exclusions and deductibles. In some cases, you can choose how much of a claim you will have to pay before the insurance company starts to pay.

There is another type of “excess,” and it’s called co-insurance. This is a percentage of the cost of any claim you make. You will have to pay for this part of the cost. This means that you share both the risk and the cost. Insurers think this will make you think more carefully about what you do before you make a claim or fight with someone else.

What type of insurance covers intellectual property?

  • #1. Commercial General Liability (CGL) Insurance
  • #2. Offensive insurance/Enforcement Coverage
  • #3. Defensive Insurance/Liability Coverage.
  • #4. Directors and Officials Coverage

Does IP need insurance?

Yes, and also, the availability of intellectual property insurance can speed up innovation and research and development efforts. Coverage of existing or potential IP assets can help owners and investors focus on driving the business strategy of the relevant company for long-term growth, profitability, and market leadership.

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