Intellectual Property Insurance
If you create something original like a product, design, or even a brand name, you have intellectual property (IP) rights that give you legal ownership over how they're used, shared, or reproduced. When someone uses your work without your permission, intellectual property insurance on a professional liability policy can help you take action and defend your rights.
What is intellectual property infringement?
As a business owner, your original ideas and creations are what make you unique. Some common types of IP for small businesses are:
- Patents: These are your inventions, which could be original products or novel processes.
- Copyrights: Original photography, illustration, graphics, written content, and software.
- Trademarks: Your company name, logo, and any taglines could be trademarked to prevent them from being used by others.
- Trade secrets: Confidential information, including software code, manufacturing processes, and proprietary formulas, is considered IP.
Types of intellectual property coverage
IP rights work both ways, and it's possible to unintentionally use someone else's work without realizing it. If that happens, you could face legal action and may need an attorney to defend you. Intellectual property insurance includes two types of protections: one that helps you when your IP is misused, and another if you infringe on someone else's IP.
Enforcement coverage
If your work is compromised by somebody else, this coverage helps enforce your rights. It covers:
- Investigation expenses
- Attorney fees
- Court costs
- Damage recovery costs
Infringement defense coverage
If you're sued for infringing on someone else's trademark, copyright, patent, or trade secret, infringement defense coverage can pay your legal costs, including:
- Attorney fees
- Court costs
- Settlements
- Judgments
What can't be protected as intellectual property?
IP is a legal designation, and some things aren't considered IP. For example, facts, ideas, and concepts can't be copyrighted and protected, but your unique expression of them can be. Some other examples include:
- Methods and processes, unless they're novel or unique
- Generic phrases
- Common property
- Laws of the universe
- Mathematical formulas
- Utilitarian elements of design
- Geometrical shapes
Why do you need intellectual property coverage?
Insuring intellectual property in the evolving digital landscape is more important than ever. According to the National Intellectual Property Rights Coordination Center, IP thefts cost businesses an estimated $1.14 billion. Let our team of specialists help you protect your IP rights.
What professions need IP infringement insurance?
Any business that creates original work and has patents, copyrights, and trademarks should think about getting business insurance with IP coverage. Some at-risk professions include:
How much does intellectual property insurance cost?
Intellectual property coverage can be included in professional liability insurance, so those rates can give you an idea of what you'll pay. In 2024, the median monthly cost of a professional liability policy through Progressive Commercial was $42, with an average price of $66. Your actual business insurance rate depends on things like your industry's risk level, number of employees, coverage amount, location, and claims history.
Tips for preventing IP theft
Keep your small business's intellectual property safe from hackers, copycats, and competitors. Start by evaluating what qualifies as IP, such as original product designs, a revenue-generating client list, or proprietary software. Other helpful tips include:
- Limit access: Use multi-factor authentication, secure file sharing, and encryption for private material, and only let essential people have access.
- Register your properties: Secure trademarks, copyrights, and original patents with legally binding documentation so you can prove your ownership.
- Put legal agreements in place: Prevent theft with licensing and non-disclosure agreements and employment contracts. That said, having intellectual property insurance gives you added protection if these agreements get breached.
What to do if my IP gets stolen?
Before taking legal action, consider other methods like sending a cease-and-desist letter or negotiating an agreement.
For example, if you're a photographer and someone uses a photo of yours without permission, you can ask them to pay a licensing fee to continue to use the image. If they refuse or ignore your request, intellectual property coverage can help cover legal expenses if you need to escalate the situation.
Protect what's legally yours
Your ideas and creations are priceless. Safeguard them with intellectual property insurance from Progressive Commercial. Our expert agents can help you choose the coverage that's right for your business — and your brainchild.
