Commercial insurance is limited for patent infringement
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Commercial insurance available for patent infringement or intellectual property violations is limited, a risk management consultant said.
“There's not much out there for limits,” said Richard S. Betterly, president of Betterly Risk Consultants Inc. in Sterling, Mass. “For a larger company, it's not an easy thing to insure. For a smaller company, it's insurable but cumbersome.”
In an April review of the intellectual property insurance market in the Betterly Report, the company said coverage available “is the province of highly specialized sources such as Lloyd's, Liberty International and ProSight Specialty, with two exceptions.” Those are patent infringement indemnity coverage available through Chartis Inc. and coverage offered by ThinkRisk Underwriting Agency, backed by Great American Insurance Co., for infringing the aesthetic design of products.
“It's still rather a challenging thing to buy” with “rather low limits,” Mr. Betterly said. “That's not to say there isn't coverage at the captive level that's invisible or coverage that's buried in a general liability policy.”
While intellectual property policy limits of $25 million used to be commonly available, today's “carriers, I think, are just scared to death of the risk,” he said.
Betterly's April report said efforts to obtain coverage in intellectual property infringement cases through commercial general liability policies rarely succeed.
