Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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patent insurance

Many people wonder, “Do I need patent insurance?” If you have not made any inventions, programs or products, then no, but that should be obvious. However, if you have ever made or want to make an invention, then getting patent insurance should be a high priority.

You might think that you have a completely new invention that no one has ever thought about, so there is no way someone could try to sue you for infringing on another invention. The truth is that this insurance can help keep you from going bankrupt.

In the mean time, we can help you save money on your patent insurance when you enter your ZIP code in our comparison tool for FREE patent insurance quotes.

What is Patent Insurance?

Patent insurance is a type of insurance that protects you if someone takes you to court over your invention. The common court case for a patent can cost over $1 million, which is more money than most people have available. What patent insurance does is absorb most of those costs, so you only pay the insurance price and some other miscellaneous fees. For other things, you should look into intellectual property insurance.

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Why Do I Need It?

Most companies are in a race to make products quickly enough to satisfy customer demand. Due to this, two or more competing companies may end up making similar products at roughly the same time. A regular patent search will not reveal this if the patent is not being filed, so there would be no way to know another similar product is being created.

When the other company sees your invention, they may sue over infringement, saying that you stole their idea. Instead of getting involved in a costly court case, the insurance will help you during this situation.

Power Struggles

Most of the time, someone will sue you over a patent because they honestly believe you are infringing on their patent. However, other people sue for a completely different reason. If you are an individual going against a big company, sometimes big companies will sue just to make you bankrupt so you can no longer compete. Unfortunately, without patent insurance, this plan can be very effective.

Bankruptcy can even affect your life insurance rates. Prevent all these problems by entering your ZIP code in our comparison tool for FREE patent insurance quotes.

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How to Choose Patent Insurance

There are many areas to look at when deciding who your patent insurance provider will be. Here are some common areas to check:

  • Copayment for lost cases
  • Patents they protect
  • Price of insurance
  • If they protect liability and intellectual property costs
  • Legal success rate

It’s very important to compare the different patent insurance companies, as no two offer the same thing. Many insurance companies specialize in certain patents, such as electronics patents or toy patents, and this can be useful when searching for the best provider.

Aside from the payments, you will also want to check copayment. This is the amount of money you will pay if you lose the case, or if the other side does not have to pay your legal fees.

The typically copayment comes to 1-5% for $1 million. While it keeps you from having to spend that $1 million on defense fees, you still have to pay around $10,000 to $50,000. Lower copayments are usually best, but make sure you are getting quality service despite a low copayment.

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Denial of Insurance

need patent insurance

Since it can cost so much, patent insurance companies will often check your patent before they decide to give you coverage. They will evaluate your patent for likelihood of being sued.

If your patent has a strong likelihood, you may be denied insurance. This is why it is important, before making an invention or getting a patent, that you ensure your patent is easily distinguishable from other patents. Otherwise, you may be sued and you will have no one to save you.

What Do I Need Before Getting Coverage?

Most insurance types require some type of paperwork before you get coverage, and patent insurance is no different. They don’t want to lay out the money for being sued, and they want to make sure you did all the proper work to get your patent. Here are the documents you will need:

  • Proof of intellectual property search
  • Proof of patent
  • Any documents relating to patent

Without these documents, there is a high chance you will be sued since you didn’t take the right steps. Sometimes the insurance provider will be willing to perform these for you, or they will be willing to take you regardless. If you are taken though, you will have a very high premium.

Can I Get Covered While Being Sued?

This is why you need patent insurance immediately. Patent insurance will protect you only if you are not being currently sued, or if you are unaware of being sued. If you are being sued, then you will be turned down.

There are very few providers that will come to your rescue unless you file immediately. That is why comparing patent insurance companies now, rather than waiting until a court case happens, is so very important. If you claim to be unaware of a case when one is going on, you may have an additional fee on top of the patent case, so don’t lie to providers.

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What If Someone Infringes on My Patent?

buy patent insurance

Usually patent insurance is meant for protection against being sued, but there is also pursuit policies that help you when suing someone who infringed on your patent. Much like when you are being sued, the legal defense fee can be astronomical when you are pursuing someone else. You may not even be reimbursed for the fees if the court finds the defendant not guilty.

When you are comparing patent insurance, look for pursuit policies, as they can be of great help. This type of policy rarely costs much more than other policies, so be sure to get it. For more things to do when defending a patent infringement, click here.

Final Thoughts

Patent insurance is very important for any type of inventor, scientist, engineer or anyone else who makes any sort of patent. You should not wait to file for a policy, because it may be too late by the time you do. There are plenty of patent lawsuits happening everyday, and regardless of what side of the fence you are on, this insurance will help protect your assets so you, your family and your company does not go bankrupt.

Start comparing patent insurance rates today, by entering your ZIP code in our FREE comparison tool to compare insurance quotes.