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What is Intellectual Property (IP) Insurance?

Intellectual Property (IP) Insurance provides cover for your legal defence and pursuit costs in respect of IP rights and IP licence agreement issues. 


Typically this will be to do with your rights in respect of patents, trademarks, copyright and trade secrets, but can also be a business idea, scientific discoveries, inventions, designs, written material, music, data, software, etc.


What does an IP Insurance policy cover?

There are several levels of cover available as follows;


  1. Opinion Only Policy which allows a business to obtain a legal opinion about an issue

  2. IP Legal Expenses Cover which will pay the legal costs of you bringing an IP action against a third party or to defend an IP action brought against you

  3. IP Package Solution, which in addition to the above will cover the damages awarded against you if you infringe someone's IP

  4. After-the-Event, which is cover / funding for businesses who have not purchased IP cover or have purchased the “Opinion Only” Policy


Frequently Asked Questions...

What are the costs of an action?

This depends on a number of factors, but our understanding is that the average cost of an action that goes through the High Court is approximately £350,000.



What does reasonable prospects of success mean?

Like with all Legal expenses policies, the insurer will need to be confident based on the information provided that there is a reasonable chance (usually 60%) that they will win before they will provide cover for you to proceed with the action.


Can I use my own law firm?

This will again depend on the insurer. In some cases the insurer will have preferred partners they will use and in other cases they will allow you to use your own, but this sometimes increases the excess.


I have an existing Professional Indemnity policy, does this cover it?

Most existing Professional Indemnity policies will provide an element of cover to defend yourself if you accidentally infringe someone's IP, but only a few will cover you to pursue someone if they have infringed your IP and the limits of indemnity in these cases are usually very low.



Does my IP have to be registered?

This will depend on the type of IP and the insurer.



Do I need Intellectual Property (IP) Insurance?

Having this cover provides the funds that would help you stop people stealing or copying the names of your products or brands, your inventions, the design or look of your products and the things you write, make or produce, or help defend you if you accidentally infringe someone else’s. If you don’t think you could afford the costs of an action and your IP is an important part of your business then cover should be considered.


If you have any further questions or queries surrounding Intellectual Property (IP) Insurance, please feel free to contact us and we will be happy to talk you through it.