Instances of intellectual property infringement have risen in recent years. Individuals, third parties, and competitors can carry out infringing activities that can lead to significant financial and other losses for a company. Owning intellectual property such as patents, trademarks, and copyright provides companies with the ability to stop others from using their IP without permission. Intellectual Property Rights (IPR) insurance may be available to protect the business from the legal costs involved in infringement cases.
What is IPR Insurance?
Intellectual Property Rights insurance can cover the legal expenses incurred while pursuing IP theft or infringement cases. There are two types of IPR insurance:
This is the most popular type of IPR insurance. It covers the costs of infringement claims for policyholders who are sued for infringement.
Abatement Enforcement Coverage
This type of insurance gives IP holders the financial support to enforce their IP rights and pursue matters of infringement and theft.
Why Should You Consider IPR Insurance?
IPR insurance can provide a business with he means to protect trade secrets, patents, copyrights, trademarks, and other IP from being misused. IPR insurance enables businesses to:
- Defend their intellectual property from trivial lawsuits
- Prevent lawsuits from happening
- Protect market share and brand reputation
Law suits can be expensive and many businesses do not have the financial capability to fight court cases or initiate them. If they do get involved, it can lead to disruption in operations and a heavy financial burden. Having IPR insurance can alleviate at least some of the financial burden.
What are the Factors Considered While Underwriting IPR Insurance?
Several factors are taken into consideration while underwriting insurance for IP. Some of them include:
- Profitability of the item patented
- Current licenses
- Infringement suspicion
- Current disputes
- Notification from other companies stating an infringement
- Initial capital investment
What is the Cost of Insurance Premiums?
The cost of premiums varies can vary greatly depending upon the type of intellectual property, risk of infringement, the likelihood of a law suit, and location. Terms and available coverage also affect cost.
Intellectual property rights insurance can be beneficial for businesses that are not financially capable of handling infringement cases. To learn more, contact us.