Intellectual Property Insurance Explained

Intellectual Property Insurance coverage protects companies for copyright, trademark or patent infringement claims arising out of the company's operation. It pays the defense costs and any judgment up to the policy limits.

You need Intellectual Property insurance if the threat exists that you could be sued by a competitor for infringing on an idea or intellectual property belonging to someone else.

As long as you are not aware of any known infringements or violations, you can apply for insurance to protect your trademark or patent. However in order to get coverage, you will be required to prove that you have completed an Intellectual Property search, or have filed a registration for a trademark, service mark, copyright or patent.

This coverage is bundled Technology Errors and Omissions Liability and it cannot be purchased on a stand-alone basis.

The burgeoning Internet commerce is based on the ingenuity and development of new processes and applications. Many new companies compete to be the first to develop and sell new products and ideas.

A competitor can financially wreck your company if you do not have the funds to hire an attorney and pay the cost of all the legal fees associated with defending your right to a patent or trademark. An Intellectual Property policy will pay the costs to defend you if someone tries to claim the rights to the same business model, process, or application.

More than ever before, intellectual property claims involving infringement of patent, copyright and trademark are being filed and litigated at a tremendous cost to both parties.

Few standard insurance policies protect businesses from loss or damage to their intellectual property. However, a growing range of policies aimed specifically at intellectual property is available and businesses would do well to consider whether such a policy is available that is right for them.

Criminal offences exist in copyright and trade marks law. The circumstances need to be studied carefully to determine if the behavior amounts to a criminal offence or a matter that can be resolved using the civil law. Intellectual property law varies greatly in different countries. Many Under Developed countries and certain countries in the former Eastern Europe have insufficient protection (reluctance to police existing intellectual property laws or the non existence of such laws) for copyright and trademark holders.