 By Kim Cauthorn, Global Intellectual Property Leader and Nita Okorie, WTW
With businesses increasingly relying on IP such as patents, trademarks, copyrights, and trade secrets, the risks posed by infringement and IP protection have escalated. This growing exposure has brought IP insurance to the forefront as an essential tool for managing these risks and safeguarding valuable intellectual assets.
The evolving IP landscape: Key trends and challenges
The IP landscape has experienced significant growth, reflecting its increasing importance in the global economy.
The surge of IP assets
Intangible assets have become central to corporate value. Recognising this, companies are increasingly investing in building and protecting these assets to drive financial growth and enhance business valuation, particularly in highly competitive markets.
The total value of intangible assets among the world’s largest companies reached an all-time high of USD 79.4 trillion in 2024, marking a 28% increase from the previous year. This figure represents the highest level recorded since the entity began tracking intangible asset values in 1996. Additionally, the gap between investment in intangible and tangible assets is widening significantly, with intangible assets growing more than three times faster than tangible assets.
The growing dominance of intangible assets in the global economy is clear, with countries such as the United States, the Republic of Korea, and Ireland leading the way. These nations emphasise innovation, creativity, and technological advancement, driving new waves of economic and financial growth.
As intangible assets now exceed the value of tangible assets, which include real estate, cash, and physical equipment, organisations across sectors, along with creators, innovators, and regulatory bodies, are prioritising the protection and strategic management of IP. This focus not only boosts individual or company financial performance but also contributes significantly to broader economic development.
Rising litigation risks
The increasing value of intangible assets has brought heightened risks that threaten the protection of IP rights. Patent litigation, in particular, has surged in recent years as companies fiercely compete for leadership in innovation and rely heavily on proprietary technologies and as patents are increasingly viewed as assets to be monetised.
Emerging technologies are driving new types of IP conflicts. For example, the rapid adoption of Artificial Intelligence (AI) has introduced complex challenges around content ownership. Businesses using AI to generate text, images, or designs often face uncertainty over IP rights, especially when it’s unclear whether the output originates from human prompts or AI’s synthesis of existing protected materials. This ambiguity raises critical questions about authorship and ownership in AI-generated content, a topic currently under active legal and academic debate. For example, is AI-assisted creation of books, artwork, brands, and even inventions protectable as an IP right? How certain generative AI models scrape everything from music to art to news articles to books is raising issues about whether such activity violates copyright protection. Between 2000 and 2022, about 190,000 AI-related patents were granted worldwide. With the rapidly escalating use of AI comes an increased risk of infringing AI patents.
Additionally, employee mobility poses another significant risk to IP protection. The migration of employees between competitors, particularly within similar industries, has led to increased concerns over the unauthorised transfer of trade secrets and proprietary information. Studies show that up to 60% of companies experience trade secret misappropriation related to departing employees. In CMS’s 2021 Top Threats of Trade Secrets Survey, employee leaks of trade secrets were cited by 47.8% of respondents, second only to cybersecurity weaknesses. Such cases often involve the modification and reuse of confidential content in new workplaces, placing IP rights under threat and emphasising the need for robust enforcement mechanisms. In fact, in 2016, the US Congress passed the Defend Trade Secrets Act, recognising a federal cause of action for trade secret misappropriation, so federal trade secret cases in the US have risen in the past few years. In federal cases filed between 2016-2022, 36% of the trade secret cases involved prior employees.
The growing significance of IP insurance
The World Intellectual Property Organisation (WIPO) confirms global patent grants have steadily increased year-over-year, with the number of issued patents hitting 2 million in 2023. As organisations increasingly recognise IP as a critical asset for gaining market share and maintaining a competitive edge, protecting and enforcing these assets has become essential. Therefore, along with the growing volume and value of IP assets has come a corresponding rise in IP disputes. For example, the number of defendants sued for patent infringement in the US increased by 19.7% from 2023 to 2024[6] and, 25-30% of US patent cases are filed against first-time defendants[6]. Most patent cases in the US are filed by non-practising entities (NPEs) such as inventors, universities, licensing entities, and investment vehicles. This means it can be difficult to predict the likelihood of a patent infringement dispute.
In addition, the costs to defend a patent infringement suit are high, and damages can run into the millions. The Corporate Research and Investigations (CRI) Group indicates that the average cost of defending a full patent infringement lawsuit can exceed USD 2 million. Trade secret misappropriation costs likewise are high, with a higher plaintiff win rate and trade secret damages averaging $13M in the last five years. IP disputes and the costs associated with them underscore the importance of IP insurance in mitigating potentially crippling financial exposure.
Companies are often surprised to learn that their other lines of insurance typically exclude coverage for patent infringement and trade secret misappropriation disputes, making IP insurance critical in addressing this escalation in IP risk. It is becoming more mainstream and an integral part of risk management rather than an esoteric or optional coverage.
Comments from underwriters
“We are seeing enquiries increase by over 25%, but even more importantly, over 50% YOY growth in policy numbers, and this is because IP insurance is no longer a niche domain for tech or pharma alone. As intangible assets become the backbone of modern business, industries from manufacturing to renewable energy, fashion to agriculture, and construction are turning to IP insurance—not just for protection, but as a strategic tool to defend innovation, unlock capital, and compete globally.” - CFC
“Demand for intellectual property liability insurance is at an all-time high, with submissions in H1 2025 up 40%. Tech and software firms, driven by AI growth, are increasing coverage to protect assets amid rising litigation. The main driver is coverage for uncapped infringement indemnities in tech licensing.” - Tokio Marine Kiln (TMK)
"Ambridge has witnessed considerable growth in both interest and placement of its IP liability Insurance, with placements more than doubling since 2022. This growth has benefited our existing and prospective insureds by providing us the experience to offer more competitive rates on select risks while also expanding the scope of coverage. Growth has been strongest in software, fintech, financial institutions, consumer goods, manufacturing, and communications sectors.” - Ambridge
“We have seen a doubling in the number of submissions in 2025 versus 2024 and have seen particular growth in the financial services sector, technology-focused risks in a variety of industries as well as traditionally IP-heavy areas such as manufacturing.”- Arch Insurance
Conclusion
As further affirmation of this trend, Willis, along with several other large insurance brokers and risk advisors, has a practice dedicated to assisting clients with managing IP exposures and obtaining IP insurance. Willis saw an increase of over 50% in the number of IP policies placed in 2024.
IP insurance serves as a vital risk management tool that safeguards businesses of all sizes as well as individual innovators from the financial burdens linked to IP disputes. By covering legal fees, damages, and settlement costs associated with IP infringement disputes—as well as other exposures such as breach of IP licenses, costs to defend IP title disputes, and costs to defend legal challenges to IP rights—IP insurance enables entities to succeed and compete in dynamic markets.
From a global perspective, IP insurance fosters innovation and commercialisation by giving businesses the confidence to create and protect new ideas. This assurance encourages business expansion and supports firms in safeguarding their international operations and subsidiaries.
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