Madeleine Brown, intellectual property practice leader for CFC Underwriting, has spent the last 15 years specializing in the diverse intellectual property market. She sees exposures for IP where others do not. And as technology creeps further into traditional sectors of the economy, such as manufacturing, agriculture and apparel, there will be more IP to protect. In this interview, Brown talks about the growing need for IP insurance.
Insurance Journal: What are you seeing in the IP world right now? Any trends or concerns that you have about the insurance market?
Maddi Brown: What’s been really interesting is that the pandemic and COVID have really pushed intangible assets, such as intellectual property, to the forefront for a lot of businesses. For many of these businesses, they’ve had to leave offices, and then, what remained were key assets — the people and the products that they were selling. That pushed forward the importance of these assets and thinking about how to protect them. Those assets have always been there, but I just think they are much more prominent now due to the pandemic. … I’m finding with intellectual property right now that the behavior of how people are viewing their IP is changing. Again, it’s really pushing forward, and we’ve seen a massive influx of inquiries and our bind rates increasing because of that. ….
IP insurance is, and has consistently always been, quite complicated and difficult to understand. It’s seen as quite a complex insurance and we’re working really hard to change that.
We don’t have any fees in order to get quotes. We like to simplify the process. It’s really not technical. It’s a liability insurance policy. By simplifying the process, we’re seeing a massive drive in clients buying this insurance now and in broker engagement. Brokers are realizing that the industry has seen an uphill trend in cyber related assets and coverages.
So, it’s quite clear that intangibles, and IP, are the next thing that needs to be thought of in the insurance market.
IJ: Are you seeing any changes in the type of business sectors in need of IP insurance today given economic changes from the pandemic?
Brown: Yes. The manufacturing space is an area where brokers need to start thinking about [IP]. It’s not just the typical sectors such as technology and software. Now you’ve got to think about the new spaces like manufacturing. IP risks have always been there, such as in fashion and apparel. But we are now seeing it in a lot of miscellaneous homeware items that you might not be thinking about. I think manufacturing is a really interesting space and sector. There’s been IP there before, of course, but it’s a growing space and clients need to think about protection and be mindful of infringement and litigation.
IJ: Do manufacturing and technology overlap when it comes to IP risks and exposures?
Brown: Yes, exactly. That’s an area that overlaps in two spaces. But yes, and I think that is quite important. …
Some of these clients are sitting on the fringes of two areas. Think about 3D printing, you’ve got manufacturing in terms of the actual component 3D printed product. But then you’ve also got the software side that sits within it. So it means these clients are really open to exposure across both sectors, which means they need protection. Going forward, that’s a really big change as you’re starting to get clients operating in more than one area.
IJ: What can you say about the insurance market for intellectual property today?
Brown: It’s a really good time to start talking to your clients about IP insurance. Right now it’s a voluntary class of insurance so that automatically changes it [the market] slightly from the hardening market. … We are seeing massive uptake in interest and binding and clients wanting insurance. Now is the time to talk to clients where there’s an opportunity for them to get the insurance coverage they need at good levels.
IJ: Lastly, where do you think the future of IP insurance will go?
Brown: I think it will continue to dominate in the key sectors such as software and technology. But I think it will grow in the other areas such as manufacturing and also in the construction space. It’s going to grow as more in these sectors are pushing outside of their limits.
There is more IP now as everything starts to become more technology enabled. You see previous human jobs being taken over by technology. That means you’re going to start to see IP in agriculture, construction, manufacturing, those areas that haven’t been previously thought about it going forward. And it will be important to start talking to clients because there’s much more [IP] in that space already than people realize.
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