Topical Issues - Intellectual Property is yours protected?
Insuring Intellectual Assets
One of this country's assets is the innovation of its people. Consequently a significant amount of effort and money is often invested to develop their ideas. Invariably developing and registering Intellectual Property assets can be expensive.
A question owners of Intellectual Property Rights need to ask themselves however is, what is the value of that Intellectual Property Rights asset if they cannot defend or enforce their rights? Unfortunately most Small to Medium Enterprises do not have the resources needed to do this and as a consequence are easy prey to the infringers. A quick check with Companies House can tell a competitor much about the company's ability to afford lengthy and expensive litigation costs and for every David and Goliath success story, such as Dyson, many other small companies cannot afford to go into battle against a well resourced and ruthless competitor. In the game of Intellectual Property Asset Protection, money is power. Infringers need to be deterred and only the realisation that the company has the resources to take the fight all the way will convince them.
The insurance industry can provide a viable solution for many companies but there is no getting round the fact that the cover is expensive to buy. The cost however reflects the very expensive nature of Intellectual Property disputes and the potential asset value at stake. The cost can deter many Small to Medium Enterprises companies, but tactically if a company believes it has an Intellectual Property asset it makes a lot of sense to include the cost of this cover in the business plan when new products and markets are being targeted. The average cost of an Intellectual Property Rights dispute in the USA is £750,000. How many Small to Medium Enterprises have reserves of this level and are willing to risk them when trying to break into this market. To what lengths will competitors go to keep you out of what they believe is their market? Too many innovative companies are at risk from bigger players because they cannot address this threat.
Intellectual Property Rights insurance is a very specialised cover but it can make a difference from turning a good idea into an asset and the business plan into reality.
Article by Craig Eason
Partner
Sovereign House
58 Elliot Street
Glasgow
G3 8DZ
Telephone Number 0141 225 1777
Fax Number 0141 225 1778
Email: craig@img-insurance.co.uk
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