Every year, I work with my insurance broker to determine how much coverage I need to mitigate risks for applicable parties connected to my business. Insurance policies are an essential part of running a small business because they protect us, especially when certain unforeseen risks occur. However, like other services that are affected by economic conditions, such as inflation, I feel that I continue to pay more every year but receive fewer coverage services. Recently, I received a notice from my insurance company stating a change in policy terms. But to my surprise, the policy term change excluded a term I did not know I had. The notice stated, “NOTICE OF CHANGE IN POLICY TERMS AMENDMENT OF INTELLECTUAL POLICY (IP) EXCLUSION.”
Changes in Policy Terms: How They Affect Small Business Owners
Firstly, I was not aware that I had this type of coverage. But after reading the IP policy exclusion change, I noticed that the policy applied to any party, including myself, to a claim or lawsuit who alleges an infringement or violation of intellectual property rights or law. I realize that this IP policy exclusion may not affect most businesses as most businesses may not have IP to protect. However, in some instances, business owners are not even aware that an IP protection issue may arise.
Understanding IP Policy Exclusions
For example, let’s say you own a photography business. You take your own photos and upload those photos on your website. Then a few weeks later, you notice that someone else has taken those same photos and claimed them as their own without your permission. This would be an instance when somebody else is infringing upon your IP assets.
The Role of IP Insurance in Protecting Your Business
Naturally, if you registered those photos with the U.S. copyright office, you would have more protected rights and remedies compared to a business that did not register the copyright for those photos. However, in some cases, even if you did not register those photos with the U.S. copyright offices, there may be limited common law remedies that you may be afforded. Thus, having an IP insurance policy that protects against infringement may be beneficial to alleviate any damages that result from the other party who took your photo without your permission.
What to Do If Your General Commercial Liability Insurance No Longer Protects You from IP Infringement
I have had several clients who have reached out to me recently, who are in this unfortunate situation where their photos are taken directly from their websites from companies across the globe who did not get permission to use those same photos. This experience makes business owners feel violated when such IP infringement is discovered.
If you have experienced such IP infringement and have recently discovered that your general commercial liability insurance no longer protects your business from such infringement, please contact Fargo Patent & Business Law immediately for a free consultation. Our attorneys are experienced with such matters and can help.