THE BENEFITS OF INTELLECTUAL PROPERTY INSURANCE

There are several benefits of IP coverage. For starters, more intellectual property lawsuits are being filed each year. Competitors can sue when products, trademarks, brand names, processes, catchphrases and services appear too similar, but they can also file lawsuits as a strategy to drain resources from the other organizations.

Then there are the so-called patent “trolls,” also known as patent assertion entities, which are another a threat. They enforce rights against accused to collect despite not using the patents in question. Intellectual Property insurance covers legal defense costs even if a case against the insured is unjustifiable or frivolous.

IP coverage is a cost-effective investment in protecting intellectual property. It can also prevent loss of market share as well as preventing unexpected cash drain on operations.

This crucial coverage also empowers companies to remain firm when threatened by lawsuits. It can ease the temptation to settle cases and/or succumb to licensing agreements or royalties that can harm a company’s competitive advantage.

For organizations intending, experiencing or planning a merger and/or acquisition or have vendor and supplier contracts requiring indemnification for IP litigation are also at higher risk for IP litigation. And in some cases, contractual relationships also require IP coverage.

With IP coverage, the policyholder is in the driver’s seat. The insurance company covers the costs of counsel, whether provided by the client or recommended by the insurer. Attorneys must adhere to litigation and billing guidelines to ensure the policy’s full value to collect coverage dollars. The insured also decides settlement terms.