Does professional indemnity cover intellectual property infringement?
Reviewed by Apex Insurance Brokers · Last reviewed 2026-08-05
If you design logos, build websites, write code or produce marketing, someone can allege that your work copied theirs. A stock image used without the right licence, a strapline too close to a competitor's, a UI element that mirrors a rival app — any of these can trigger a legal letter. This page explains exactly how professional indemnity insurance responds, where the boundaries sit, and what to check in your wording.
What "IP infringement" means for a professional indemnity claim
In the UK, intellectual property is protected under statutes including the Copyright, Designs and Patents Act 1988 and the Trade Marks Act 1994, with registrations administered by the Intellectual Property Office. Infringement means using or reproducing someone's protected material without permission. For a broker's purposes, the relevant scenarios usually fall into a few categories:
- Copyright — reusing images, photography, text, music, illustrations or code without a valid licence.
- Design rights — producing a product design or graphic that is too close to a registered or unregistered design.
- Trademarks — a brand name, logo or strapline that a court finds confusingly similar to an existing mark.
- Passing off — presenting work in a way that misrepresents one business's goods or services as another's.
Professional indemnity is the policy that typically responds because these claims arise directly out of the professional service you provided to a client.
Unintentional vs deliberate — the line that matters most
This is the single most important distinction. PI cover for IP infringement is almost always limited to unintentional or inadvertent breaches. If your designer honestly believed a font, image or concept was cleared for use and it turned out not to be, that is the kind of mistake the policy is built for.
What insurers will not pay for is deliberate, dishonest or reckless infringement — knowingly lifting a competitor's artwork, or continuing to use material after you've been told to stop. Standard PI wordings exclude dishonest and intentional acts, so a knowing breach falls outside cover.
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What a policy typically pays for
Where a claim is covered, professional indemnity usually responds to more than just the final settlement. Depending on your wording, it can include:
- Legal defence costs — often the largest expense, even if the allegation is ultimately unfounded.
- Damages or a settlement awarded to the rights holder.
- Costs to correct or withdraw the infringing material in some cases.
Because defence costs alone can run into tens of thousands of pounds, the cover is valuable even when you believe you've done nothing wrong.
What is usually excluded or limited
Not every IP scenario is covered. Common carve-outs and limits include:
| Scenario | Typical treatment |
|---|---|
| Unintentional copyright / design / trademark breach | Usually covered |
| Deliberate or knowing infringement | Excluded |
| Patent infringement | Often excluded or sub-limited |
| Infringement of your own IP by a third party | Not covered (PI defends claims against you) |
| Breaches you knew about before inception | Excluded (prior known circumstances) |
Patents deserve a special mention. Patent disputes tend to be technically complex and expensive to defend, so many PI policies exclude patent infringement altogether or cap it under a separate lower limit. Tech and product-design firms should confirm this point specifically rather than assume it's included.
Why designers, agencies and tech firms are most exposed
The businesses that ask us this question most often are the ones whose day-to-day output is creative or technical content:
- Graphic and product designers — logos, packaging, layouts and branding that must not stray too close to existing marks or designs.
- Marketing and creative agencies — campaigns, copy, imagery and video where licensing and clearance mistakes are easy to make at pace.
- Web, app and software developers — open-source components, third-party libraries, UI patterns and code that carry their own licensing obligations.
For these firms, a good PI policy often bundles IP infringement together with related exposures such as defamation and breach of confidentiality — sometimes described as media or multimedia liability. If content is central to what you sell, check that these are all named in the wording.
Not sure your current wording covers IP claims properly? We'll read the small print for you.
Get a PI quote →How much cover do you need?
Limits are usually offered in generic tiers — commonly £1m, £2m or £5m of indemnity — and the right level depends on your clients and contracts. Many corporate and public-sector clients specify a minimum PI limit in their contracts, so your commercial agreements often set the floor. For IP-heavy work, also check whether the limit applies per claim or in the aggregate across the policy year, and confirm the excess.
Practical steps to stay covered
- Keep licences and clearances on file for every image, font, plugin and asset you use.
- Note your PI is written on a claims-made basis — the policy in force when a claim is made responds, so keep continuous cover and don't let it lapse between projects.
- Report circumstances promptly — tell your insurer as soon as you receive a complaint or a "cease and desist" letter, not after you've replied.
- Read the exclusions — particularly patents, and any wording around deliberate acts or prior knowledge.
Common questions
Does PI cover me if a client sues over an image I bought a licence for?
If you held what you reasonably believed was a valid licence and the infringement was unintentional, this is typically the kind of claim PI is designed to defend — including your legal costs. Keep the licence documentation, as it supports your position.
Is patent infringement covered by professional indemnity?
Often not, or only up to a lower separate limit. Patent claims are complex and costly, so many insurers exclude them. If your firm develops products or technology, ask specifically and consider whether a broader or specialist wording is needed.
What if the infringement was my subcontractor's fault?
If you delivered the work to your client, the claim usually still lands on you, and your PI would respond to a covered claim. Written contracts with subcontractors and clear IP ownership terms help manage where liability ultimately sits.
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Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority (FRN 724952). This guide is general information, not advice on a specific policy or a substitute for your policy wording.