IP Insurance in detail

Intellectual Property (IP) often forms the bedrock of the modern technology business, the critical component upon which the organisation depends for its funding and revenue streams – and which in turn influences all key strategic decisions.

So in the same way that you wouldn't hesitate to insure your physical assets, it also makes good commercial sense to insure the risks to your intangible assets.

What if...

• You become aware that your patent rights are being infringed by a third party
• You face a challenge to the validity of your IP or to your title to IP rights
• You face an allegation of IP infringement brought by a third party

Whether it’s pursuing an infringer of your IP, or defending an allegation brought against you, the legal costs involved can be ruinous and most commercial insurance policies don’t provide the specialised protection you need.

Technology innovators are exposed to a raft of Intellectual Property risks that are constantly evolving.

How might your operations be exposed?

• Contractual IP indemnifications and hold harmless agreements may leave you on the hook for costs & expenses incurred by your customers, users, distributors or collaboration partners.
• You may suffer diminished value in your IP portfolio (or a big hole in your licensing revenue) if a successful infringement action is brought against you, or if your ownership or title to IP is impugned.
• You may have hefty reengineering costs if you’re required to rework your product to ensure it’s non-infringing - these costs may arise under indemnification obligations.
• You may have to pay damages to a third party who brings a successful infringement action against you. This could even involve action by an employee who claims title to your IP.
• If you’re exposed in North America the legal expenses and settlements applied will often be much higher than in Europe.

Risks can also arise when commercial transactions occur, such as with a merger, or when you decide to exit and sell your business, or dispose of your IP portfolio. You’ll be required to provide representations and warranties relating to your IP rights. What if they’re called into question after the transaction? How can insurance help you to ring-fence these liabilities?

Perhaps you’re raising finance to acquire an IP-rich business or IP portfolio. A challenge to the validity of the IP rights post-acquisition won’t impress your investors. Intelligently arranged insurance solutions can play a significant role in helping to secure investment in intangible asset portfolios.

Take a look at our case studies to see how we’ve helped our customers protect their IP rights.

Got a question? We're experts in insuring IP in the science and technology sector. Click here for a free, no-obligation quote.