Entrepreneur’s Cheat Sheet: Intellectual Property Insurance

Intellectual property insurance: the basics

Intellectual property insurance can be a huge asset to highly innovative companies.  These are the need-to-know basics of IP insurance coverage.

Why you need it:

• You build things, write code, or otherwise create a product that could be infringing on an existing patent
• It’s realistic that an infringement lawsuit could put you out of business
• Your business’ valuation is reliant on your IP, patents or otherwise
• You’re in an innovative, competitive space, and the risk of infringing on other companies’ IP is high

Lawsuits & claims – the facts:

• IP litigation is one of the most common claims out there, and far more likely to occur than even D&O claims
• Legal costs for a small company will be in the millions if they are forced to litigate to judgment
• There were 6,092 patent actions in the US courts alone in 2013 (If this stat included all of the disputes that were settled out of court, the number would be MUCH higher)
• Patent Trolls initiate 67% of all IP lawsuits in the US

What’s covered:

• Patent Infringement claims (excluded by any other policy)
• Legal & defense fees related to IP lawsuits
• Judgments against the company
• Settlements when the matter can be resolved out of court
• “Abatement” costs – some policies actually allow you to go on the offensive to pursue the infringer on YOUR patent

There’s never been a better time to buy IP Insurance: new carriers are continuing to enter the market and the competition is driving big improvements in the product.  Get in touch with us to learn more about how Intellectual Property Insurance can help you stay protected from IP lawsuits.

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