Agencies, Blog - May 2, 2023
Breach Of Licence Insurance: An Overview
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When you apply for a media licence to publish a specific image or use copyrighted material, you’ll need to tread carefully to stick to the agreed guidelines. If an agency were to allegedly breach the licence terms, it may face legal action for copyright infringement.

Below, we’ve outlined what Breach of Licence cover in your Professional Indemnity policy is, and what it may protect against.


What is Breach of Licence insurance?

Breach of Licence cover can protect agencies if they’re alleged to have violated the conditions outlined in a licence agreement. For instance, it can protect against using copyrighted material without proper permission. Say an agency used an image in a country where the licence prohibits it – they may breach the licence agreement and potentially face a claim.

It could also step in for mistakes, like an agency incorrectly using the licensed media, such as publishing it on the wrong platform, using non-agreed colours, or incorrect sizing.


What does Breach of Licence cover pay for?

If another party makes a claim against the agency, Breach of Licence coverage might cover the costs of defending the claim and any awarded damages.

Depending on the scope of the policy, Breach of Licence cover can also pay for other costs, like protecting the reputation of the business following the breach.


When might you face a claim?

Here’s an example of a marketing agency breaching their licence:

You create a marketing campaign for a client but feature copyrighted music without obtaining the proper permission or licensing from the copyright holder. If the copyright holder finds out and decides to take legal action against your agency, you could be held liable for copyright infringement.

In this case, if you have a Professional Indemnity policy with Breach of Licence coverage, the insurer could help cover the costs of defending the claim and any damages.


How do you get Breach of Licence cover?

Breach of Licence cover is generally found within a specialist Professional Indemnity policy – typically designed for marketing, communications, and other creative agencies.

It operates closely with Breach of Intellectual Property cover, as claims can span across both elements. In fact, some policies include it within the Breach of Intellectual Property section.

Either way, when Breach of Intellectual Property cover is part of a Professional Indemnity policy, you might find it’s often tied to particular breach types. For instance, your cover may specifically apply to use of the content outside the allowable territories or continued use beyond the time specified.

Specialist policies designed to protect against breaches might include a broader Breach of Licence cover, like CFC’s Licencing Agreement Liability policy. These focused policies are often more expensive than standard Professional Indemnity insurance. However, they usually give better protection against breaching the agreed geographical scope, duration, and use.


What if I don’t have Professional Indemnity?

Without Professional Indemnity cover, Breach of Licence can be hard to insure. Some businesses – like product manufacturers creating products under a licence agreement – may want Breach of Licence cover but don’t currently have a Professional Indemnity policy. In this case, they may consider a standalone Breach of Licence policy.


How RiskBox can help

Whether you need Professional Indemnity or standalone Breach of Insurance cover, we can help. Get in touch with our team on 0161 533 0411 or fill in our online contact form to find out more.


Photo by Roberto Nickson on Unsplash

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